The National Fair Housing Alliance is investigating the ways that demographic information is displayed on real estate sites to determine whether some companies’ practices violate fair housing laws.

Syndicated columnist Ken Harney reports that the NFHA is examining the practices of online brokerage Movoto and neighborhood search site NeighborhoodScout.

The advocacy group launched the probe after an Inman News article highlighted the potentially negative consequences of layering community information — including crime, school, sex offender and racial data — into real estate sites and apps.

An NFHA employee told Inman News in early June that such practices “definitely raise fair housing concerns,” and that it planned to investigate them.

Screen shot showing Movoto’s “race and gender” breakdown of the ZIP code 20020 in Washington, D.C.

Screen shot showing Movoto’s “race and gender” breakdown of the ZIP code 20020 in Washington, D.C.

Some housing observers argue that weaving demographic data into the online real estate search experience — particularly commingling it with listing data — can encourage people to filter listings based on race or familial status.

That could potentially produce a discriminatory effect on populations protected by the Fair Housing Act, which prohibits discrimination in housing-related transactions on the basis of race, color, national origin, religion, sex, disability and familial status, Russ Cofano, the CEO of the Missouri Association of Realtors, previously told Inman News.

Some real estate agents note that websites and apps that surface such data are doing what many agents carefully avoid for fear of violating fair housing laws or the National Association of Realtors’ code of ethics.

Screen shot showing NeighborhoodScout's search options for racial and ethnic makeup.

Screen shot showing NeighborhoodScout’s search options for racial and ethnic makeup.

In 2009, NFHA threatened to file a fair housing complaint against for showing racial statistics on listing pages, arguing that it “may have the effect of steering prospective homebuyers away … and undermining the promotion of racial integration, one of the purposes of the Fair Housing Act,” Harney reported.

The group’s lawyers also said that displaying such data violates the National Association of Realtors’ code of ethics, which prohibits agents from volunteering “information regarding the racial, religious or ethnic composition of any neighborhood.”

Movoto later agreed to remove neighborhood racial breakdowns from listing pages.

But it continues to show such information on community information pages. A Movoto spokersperson told Harney that the firm denies any fair housing violations.

The NFHA is also examining NeighborhoodScout. The site’s new advanced search tool enables users to filter for census tracts by familial and racial compositions, among hundreds of other variables.

NeighorhoodScout CEO Andrew Schiller said that the website does not breach fair housing laws.

The site can actually promote integration by highlighting appealing characteristics of communities that some people may have otherwise overlooked, according to Schiller.

NeighorhoodScout “is useful for understanding and revealing the truth about locations, helping to break down out-moded stereotypes that could otherwise harm places,”  he said.

He also emphasized that NeighorhoodScout, unlike Movoto, is not a brokerage, and does not display listings.

Searching based on racial and ethnic statistics is not necessarily contemptible, he added. Schiller pointed to the case of a Korean immigrant with poor English skills who used the site to find other areas with high concentrations of Koreans.

“Is that a bad thing?,” he said. “I don’t think so.”

Websites and apps are increasingly blending neighborhood statistics with listings. FindTheBest Places shows data including racial composition for communities that contain as few as 200 people. And Trulia recently place school and crime ratings next to property descriptions on its listing pages.

RealtyTrac sparked protests from some real estate agents when it mixed neighborhood characteristics including the locations of sex offenders and toxic dumps into listing pages. It’s since migrated that data to property pages that exclude listing data.

findthebest ethnicity

Screen shot showing a section of FindTheBest’s profile of Wilson Point in Norwalk, Connecticut, a neighborhood that has only 189 people, according to the site. 

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