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Coldwell Banker, eXp, Sotheby’s International Realty and RE/MAX were among more than 200 brokerages and landlords swept up in an undercover sting targeting firms accused of rejecting tenants who rely on Section 8 Housing in California, according to reports.
The investigation by the consumer watchdog Housing Rights Initiative resulted in 112 complaints of brokerages and landlords rejecting prospective tenants who sought to use Section 8 Housing Choice Vouchers as a source of income to secure housing. Those complaints were filed Tuesday with California’s Civil Rights Department, the group said in a statement.
“Over the course of a year, HRI trained, equipped, and deployed an army of undercover investigators, who posed as prospective tenants with Section 8 vouchers,” HRI said in a statement Tuesday. “These investigators contacted hundreds of brokers and landlords by text message to determine compliance with California’s fair housing laws.”
A whopping 70 percent of prospective tenants who inquired about Section 8 vouchers in Los Angeles were rejected, according to the watchdog group. The Housing Rights Initiative also found that investigators were discriminated against 44 percent of the time in San Francisco, 53 percent in Oakland and 58 percent in San Jose.
HRI released a Google document listing each case of alleged discrimination, including timestamps, broker names, listings and screenshots of text messages. The texts revealed a range of responses from brokers, some of whom expressed reluctance to deal with the “hassle” of working with the Section 8 program, while others claimed landlords were not registered with the program or that Section 8 was not eligible for particular listings.
Text messages submitted as evidence — though not independently verified by Inman — appear to show brokers from eXp and Sotheby’s rejecting applicants who inquired about Section 8 vouchers for specific listings.
Inman requested comments on the allegations from eXp Realty, Sotheby’s International Realty and RE/MAX. A spokesperson for Coldwell Banker told Inman it was reviewing the claims.
“Coldwell Banker Realty advocates for fair housing practices and we offer enhanced training, awareness and staffing measures to promote equitable access to housing for all,” a spokesperson for Coldwell Banker Realty told Inman on Wednesday, “We are currently reviewing the claims.”
In 2019, California Governor Gavin Newsom signed legislation prohibiting housing discrimination based on personal characteristics, including income source. The law is designed to protect participants in housing voucher programs and ensure they receive a fair and thorough vetting process when applying for housing, according to the bill.
“The goal of these filings is to get the real estate companies to stop their discriminatory housing practices and exacerbating California’s homelessness and affordable housing crisis,” HRI said in a statement.
“Furthermore, the result of HRI’s investigation underscores the need for proactive and systematic enforcement to combat housing discrimination and for the State of California to provide adequate funding for the California Civil Rights Department to meet the scale of the problem,” the group added.
Research by the Urban Institute in 2018 found that up to 76 percent of landlords in the Los Angeles area refused to accept Section 8 vouchers, with the rate rising to 82 percent in low-poverty neighborhoods. Los Angeles Times reporting in 2019 showed landlords cited concerns about red tape and economics as reasons for refusing vouchers, noting they could charge more than the government was willing to pay.
