“Steering” is a term used in the real estate industry to describe the act of directing clients toward or away from certain properties based on their characteristics. For example, a real estate agent might steer a client towards a particular type of property based on the client’s budget and needs. While all steering is not necessarily illegal, it can be considered unethical if it is done for the benefit of the agent rather than the client. In this blog post, we’ll take a closer look at steering in real estate and whether or not it is ethical.
What is Steering?
Steering in the real estate industry is an unethical practice that is in direct violation of the Federal Fair Housing Act. It is defined as any action taken by a real estate professional to either induce or dissuade a buyer from making a purchase based on their protected class status. This can take place through language, the use of phrases, or even marketing materials. Steering can be very harmful and illegal, as it prevents individuals from being able to exercise their right to choose where they would like to live. For this reason, all real estate professionals must be aware of this practice and ensure they never take such actions during their employment.
Different types of steering and why agents should avoid it
Effective agents need to be aware of the different types of steering that clients may use to make sure they are not violating any laws. Steering happens when an agent attempts to influence or limit a client’s housing choices, either by providing too much information on one property, leading them away from certain properties, or suggesting certain neighborhoods. This type of behavior is illegal and agents need to watch out for signs such as giving too specific directions to a property (including areas they may recommend avoiding) or focusing solely on properties offered through their agency.
Additionally, agents should remain objective and discuss all valuable options with their clients so that they can make the best decision for themselves. Agents should keep in mind that engaging in steering has severe consequences for both clients and Realtors® alike and should always seek professional advice if further explanation is needed regarding how to prevent it from occurring.
Tips to avoid steering clients
As a real estate agent guiding clients through the home-buying process, it’s important to remember the responsibility you have to protect them and avoid steering them in a negative direction. Your clients rely on your expertise and sound advice so there are some tips you can follow to make sure you are giving them the most unbiased opinion possible.
Before making an offer or recommending a purchase, always look at both sides of the equation and review options objectively. Take time to actively listen to your clients and encourage feedback. Clients should be presented with comparable properties in the same neighborhood, different neighborhoods, and similar living arrangements.. By providing recommendations that come from facts instead of favoring one side over another, you will ensure that your clients have all of their bases covered before signing any documents. Ultimately, instilling trust in one’s client is key to having long-term relationships and successful real estate endeavors.
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