A real estate broker operating in New York is approached by a client who expresses a strong preference to only view properties in neighborhoods with a specific ethnic demographic. The broker, wanting to maintain a good client relationship, agrees to exclusively show properties meeting this criteria. Which of the following best describes the broker's action?
- APracticing ethical client representation, as the client has free choice.
- BEngaging in illegal steering, violating fair housing laws.
- CUpholding client obedience, as they are following the client's explicit instructions.
- DPerforming due diligence by narrowing the property search based on client needs.
Show answer & explanationAnswer & explanation
Correct answer: B. Engaging in illegal steering, violating fair housing laws.
Steering is the illegal practice of guiding prospective buyers or renters towards or away from certain neighborhoods based on protected characteristics, such as race or ethnicity. Even if initiated by the client, a broker complying with such a request is participating in a discriminatory act and violating fair housing laws, specifically the federal Fair Housing Act and New York's Human Rights Law. The duty of obedience does not supersede anti-discrimination laws.
Why the other options are wrong
- A. This is not ethical; it is discriminatory and illegal, regardless of the client's preferences.
- C. The duty of obedience does not require an agent to follow unlawful instructions; fair housing laws supersede client preferences in this context.
- D. Due diligence involves factual property-related research, not discriminatory filtering based on demographics.
Steering (Fair Housing)
The illegal practice of guiding prospective buyers or renters to or away from certain neighborhoods based on protected characteristics.
- Violates Fair Housing Act and NY Human Rights Law.
- Can be subtle or overt.
- Broker's duty to client does not override anti-discrimination laws.
Memory trick: Fair Housing: No Steering, No Blockbusting, No Redlining!