50 Years Later, The Fair Housing Act Continues To Evolve

When President Lyndon B. Johnson signed The Fair Housing Act in 1968, the landmark ruling laid the groundwork for an open and equal housing market. The act put a stop to redlining neighborhoods and explicit loan refusals to minority groups. While a step in the right direction, 50 years later, there remains work to be done. 

A growing affordable housing shortage and a delayed response from the U.S. Department of Housing and Urban Development on anti-segregation measures have fueled concern over discriminatory housing. Years after the Great Recession, the number of African-Americans who own a home is comparable to pre-1968 percentages. But in the face of inequality, the Fair Housing Act continues to adapt, serving as a guide for homeowners, tenants, property owners and managers.

For Blanton Turner principal Barry Blanton, the act introduced best practices that continue to adapt to fit the needs of real estate leaders, renters and homeowners. 

“It was a game-changer, and it continues to be one of the best pieces of legislation passed in the 20th century,” Blanton said. “There have been 42 amendments since the law passed, and today it continues to fulfill the mission that began 50 years ago.”

Redlining and the rise of segregated housing

In 1933, when the U.S. was in a Great Depression-induced housing shortage, the government established the practice of redlining. Under this practice, maps of metropolitan areas were color-coded by the Federal Housing Administration based on where it was safe to insure mortgages. The FHA defined “safe” neighborhoods as predominantly white suburbs. Anywhere African-Americans lived was colored red to indicate to appraisers that these neighborhoods were too risky to insure mortgages. Practices extended to multifamily owners, who could refuse applications from minority renters. 

In 1968, discriminatory practices were outlawed under the Civil Rights Act and gave both landlords and renters guidelines for supporting equitable housing. For real estate agency Cohen-Esrey's Chief Operating Officer Ryan Huffman, fair housing created an equal process for all parties. 

“The Fair Housing Act broke down barriers in our industry by creating equal housing opportunities to be available for all Americans,” Huffman said. “Its positive impacts can be felt in all communities, residents and landlords across the country, from the large to the small. For landlords, it created a guide map to easily follow with a basic premise of treating everyone the same, which helped with ease of screening and ease of review of applications.”

An evolving playbook

When first enacted, the only protected classes under the FHA were race, color, religion and national origin. In 1974, sex was added as a protected class, with the Disability and Familial Status to follow in 1988. Rules continue to be modified and tested. Last year, a federal court asserted that sexual orientation-based discrimination is a form of sex discrimination.

Other amendments address acts and practices that may indirectly violate the Fair Housing Act. HUD, for example, published guidance that landlords cannot use arrest records as a basis for excluding rental applicants. In 2013, the Disparate Impact Rule expanded the culpability of landlords in discriminatory practices, holding them liable for policies that could have an unintended impact on members of a protected class.

The ruling recently surfaced in a lawsuit brought by housing activist group Churches United for Fair Housing against the city of New York over the rezoning of the former Pfizer site in Brooklyn. 

According to CHUFF, the city did not incorporate a racial impact study into its rezoning process. The organization argued that the development, which plans to offer a mix of affordable housing options and market-rate housing, will most likely be filled by more affluent, primarily white tenants. 

The argument also takes into account the 2015 Affirmatively Furthering Fair Housing Rule, which required cities to outline the ways in which they could correct segregation in housing.

The long road to equality 

The Pfizer suit comes as HUD Secretary Ben Carson pushes for a restructuring of the Disparate Impact Rule and AFFH. New York City, facing its own housing crisis, has chosen to move forward with its own fair housing plan, titled “Where We Live NYC.” The city will seek input from both community stakeholders and New Yorkers impacted by the rule, which — along with analyses of its own data — will lead to a report outlining how the city can promote fair housing choice.

In New York City, nearly three in 10 renters are rent-burdened, spending more than half of their income on rent. Minorities, immigrants, the LGBT community and disabled New Yorkers are disproportionately affected, according to a recent Equality Indicators report. 

Property managers can advance fair housing practices by familiarizing themselves with existing best practices. To celebrate the Fair Housing Act’s 50th anniversary next month and to support its mission to improve fair housing opportunities, the Institute of Real Estate Management is allowing members to take its online “Fair Housing and Beyond” course for free in April. 

Through continued leadership, observance of law, education and cooperation of real estate professionals, the industry can work toward the goal of an equal and open housing market. 

“[The Fair Housing Act] not only leveled the playing field for so many, it serves as a reminder that despite severe political differences, good things actually can be accomplished through the legislative process,” Blanton said.

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