Morgan Williams, general counsel for the National Fair Housing Alliance, one of the groups that filed the suit against Redfin, said companies will have to be extra cautious about discrimination as technology takes over more work in real estate.

A housing discrimination lawsuit filed against online brokerage Redfin could have far ranging impacts for other companies in the industry, according to a lawyer working on the case, especially as technology handles more and more of the real estate process.

Morgan Williams

Morgan Williams is the general counsel for the National Fair Housing Alliance (NFHA), one of the advocacy groups that sued Redfin last month. The crux of the case is that the housing advocates believe Redfin’s pricing policies make its services more accessible to people in predominantly white neighborhoods.

In a phone conversation with Inman, Williams called Redfin’s practices “a digital form of redlining.”

But Redfin is far from the only real estate company that selectively chooses where to operate. Other companies also selectively choose to focus their services exclusively on certain price points.

Williams did not identify other specific companies that might have discriminatory policies. But asked about the potential for the Redfin suit to impact other members of the housing industry, he said there is “the potential for that.”

“Certainly, as the marketplace becomes increasingly digital and online, and companies are able to offer their services in new ways that target the marketplace in different ways, that targeting can have a discriminatory effect,” he said.

One particular point of concern going forward could be interactions that rely on algorithms. Such technology has enable real estate companies — and firms in many other industries — to increase their efficiency. Williams said algorithm-based tech can also be used to “open up market opportunities to a broader section of communities.”

But it’s a double-edged sword. “The same biases that have long infected the market also structure the kind of data that may be utilized,” he explained. “Those same biases may impact these models and produce discriminatory outcomes.”

In other words, an algorithm can be programmed — either on purpose or accidentally — to be discriminatory. To counteract this issue, the NFHA is actually working on a tech initiative right now to combat that type of tech-driven discrimination.

Williams declined to say if the NFHA is currently investigating any other real estate companies or industry policies.

However, he did say that there is a precedent for the Redfin case specifically. In the 1990s, fair housing advocates sued insurance companies for limiting service based on minimum home values. Ultimately, those cases eventually forced changes in the insurance industry, and Williams drew a comparison between that situation and the Redfin case.

“This particular issue of housing policies that are set around limiting service on the basis of minimum home value have been fundamentally problematic in the housing market for decades,” he said. “Policies of this sort have long been deemed problematic and discriminatory.”

Williams added that “a consumer always has the option potentially to go to some other service provider but that doesn’t ameliorate the discriminatory harm.”

It remains to be seen how the Redfin case might play out, though Williams did say that his organization has heard back from agents “who have previously been concerned” about the online brokerage’s pricing policies.

Glenn Kelman | Photo credit: Redfin

Redfin itself has disagreed with the allegations in the lawsuit. The company, and in particular CEO Glenn Kelman, have been vocal advocates for fair housing. However, in a blog post after the lawsuit went public, Kelman argued that Redfin chooses where to operate based on where and how it can make enough money to pay its agents.

On the other hand, agents who recently spoke with Inman were generally unpersuaded by that argument.

Either way, though, the costs of discrimination are significant.

In addition to the impacts on individuals who face barriers getting into their preferred homes, a recent analysis from Morgan Stanley found that racial housing inequality has cost the U.S. 800,000 jobs and $400 billion in tax revenue. Racial inequality has also prevented roughly 5 million people from owning homes, the analysis revealed.

Email Jim Dalrymple II

Show Comments Hide Comments
Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Success!
Thank you for subscribing to Morning Headlines.
Back to top
Only 3 days left to register for Inman Connect Las Vegas before prices go up! Don't miss the premier event for real estate pros.Register Now ×
Limited Time Offer: Get 1 year of Inman Select for $199SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription
×