What is Real Estate Steering?

What is Real Estate Steering? Have you ever asked a real estate agent a question and not received a direct and simple response? Have you ever wondered what would have caused them to answer the question without really answering it?

Asking a question like "what are the best schools in the city?" or "is this neighborhood actually safe?" might seem like simple and harmless questions, but in terms of asking a real estate agent, there are some items considered as steering.

What is steering in the real estate world?

Real estate steering is used to describe when a real estate agent is considered to be influencing a client's decisions based upon characteristics that have been outlined in the fair housing act. This can include items such as race, religion, disability, familial status, nationality, and gender.

Steering is thought to most often be an issue that affects homebuyers more than home sellers as an agent guides their client through a real estate transaction process. Real estate agents are not allowed to steer a client toward or away from certain areas or purchases based on bias.

In short, if an agent due to their personal bias assumes what their client wants or does not give them equal and neutral advice they could be in hot water. Steering a client in the real estate world is illegal in the United States.

Why steering is illegal in real estate

In 1964 the Civil Rights Act was passed. Even though this was now law, minority groups were often still unwelcome or unable to purchase homes and live in certain areas due to unfair and discriminatory practices.

Four years later in 1968, a follow-up to the Civil Rights act was enacted including Title Eight also known as the Fair Housing Act. This new act banned discrimination concerning real estate both in the purchase and sale as well as rental and financing of any housing and this includes real estate steering. Right now the Department of Housing and Urban Development enforces the Fair Housing Act for both buyers and sellers as well as renters and anyone applying for a mortgage.

Items considered steering that agents need to avoid

There are some items in the real estate world that are obvious steering situations these can include assuming that a client wants to purchase a home in a neighborhood with people that look like them. It can also include redirecting a buyer from looking at homes in an area they are interested in into another area that has better schools in the agent's opinion. It can also include showing certain properties to a single woman based on what the agent perceives as her ability to maintain the property.

All of these are very obvious examples of showing bias and steering a client in a different direction based upon the agent's feelings and opinions of the situation due to their own bias. But sometimes steering is not always as black-and-white.

This is why the most experienced and professional real estate agents will think before they speak to avoid answering questions in certain ways that may come across as steering. Some of the most common topics real estate agents will not discuss to avoid accusations of steering include the crime rate of an area, the school systems within a city, and the demographic of certain neighborhoods. They will also keep their focus away from places of worship.

What expert agents do to answer questions instead

Your real estate agent wants to serve you and give you the best most insightful information about an area and purchasing a specific home as well as possible. To avoid real estate steering and keep within their legal duties they will set up boundaries. They can give you advice on certain aspects of properties and locations like real estate stats.

To answer questions that are steering they might instead direct you to ways in which you can find information on your own to answer your questions. This way you can find out from a third party only reporting the facts of these certain aspects like the crime rate in an area. And you can form your own opinion without your agent being involved or steering your decision.

For more information on purchasing a property in Omaha or Lincoln Nebraska please contact us anytime.

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