Truth and Reconciliation

  • Senyors by Senyors
  • 5 months ago
Header area of a typical real estate deed document

Warning: Language in this article and excerpts of historic documents embedded here include offensive and inappropriate racial language.

Seventy-five years after Shelley v. Kraemer, the long shadow of racially restrictive covenants still hangs over the nation. These explicitly discriminatory clauses were written into property deeds to prevent racial, ethnic, and religious minorities from owning and occupying certain properties. Racially restrictive covenants reenforced the conflation of race and property value that remains at the root of segregation and inequality in America.

In 1948, the U.S. Supreme Court ruled in Shelley that racially restrictive covenants were unenforceable in court. However, the court preserved the legality of discrimination in private agreements. That wasn’t changed until 20 years later when, in 1968, the Fair Housing Act was passed. To this day, however, discriminatory language lingers in property records and regularly resurfaces in real estate transactions.

Today, the National Association of REALTORS® and its members are actively advocating for laws that address the presence of restrictive covenants in real estate documents. At the same time, as part of its Fair Housing Action Plan: ACT! (ACT stands for accountability, culture change and training), the association is confronting the legacy of such covenants, including its own role in their use.

A Reckoning With the Past

Documents from NAR’s archive show that the association once supported the covenants, and, after Shelley, some members even entertained pushing for a constitutional amendment.

In a 1926 newsletter to members after the U.S. Supreme Court affirmed the constitutionality of racially restrictive covenants in Corrigan v. Buckley, the association (then known as the National Association of Real Estate Boards) said “restrictions imposed by private contract are now in nationwide use in the protection of residential districts against deterioration of character.”

In response to the Shelley ruling, one local association proposed a constitutional amendment to restore the status quo and prevent “[the] widespread depreciation in value of homes … [and] the insistence of some Negroes upon moving into areas previously restricted exclusively to the occupancy of Caucasians … .”

It’s unclear what efforts were subsequently made to sponsor a constitutional amendment. REALTORS® turned their advocacy efforts toward protecting the right of property owners to sell to buyers of their choice. This national campaign to fight “forced housing” effectively defeated fair housing provisions in early civil rights legislation and delayed the passage of the Fair Housing Act until 1968, when the assassination of Dr. Martin Luther King Jr. ignited the political will of the nation.

Four years later, the association passed a policy urging, “all citizens to respect the law of the land prohibiting discrimination,” marking a pivotal step in the association’s adoption of equal opportunity in housing.

Unenforced, but Still Evident

There’s a movement today to pass state laws that enable governments and property owners to disavow discriminatory language without whitewashing history. In addition to supporting such laws, NAR is supporting federal and state efforts to document and address the continuing effects of restrictive covenants. For many members, the extent of the restrictions that once existed in real estate comes as a surprise.

“Growing up you really don’t learn these things,” says Jessica Thompson, green, c2ex, broker-owner of Cityburb Homes in Oklahoma City.

That is true—unless you’ve lived it. “I became aware as a kid,” says Janel Randall, GRI, C2EX, broker with Better Homes and Gardens Real Estate Paramount in Edmond, Okla. Randall is founder and president of the United Oklahoma Association of Realtists, a chapter of the National Association of Real Estate Brokers, “the oldest minority professional trade association in America.” She says grandparents on both sides of her family experienced racial discrimination when trying to purchase their homes.

Although Randall was able to buy in her neighborhood of choice when she moved from New Orleans to Oklahoma in 2005, she wasn’t able to fully escape the effect of past restrictions. She was told by neighbors that hers was the only black family in the neighborhood. “I would go to the [neighborhood] pool and use my code to get in, [but] people would ask, ‘Who are you?’ and ‘Where do you live?’ My children would walk the neighborhood and the police would get called on them. I was forced to have state IDs made for my children at eight and nine years old, so that they could prove that they live in the neighborhood.”

Absent this lived experience, many real estate professionals learn this history of racial covenants on the job. “The first time I actually encountered a racially restrictive covenant was when a title company sent the CC&Rs (Covenants, Conditions and Restrictions) for a transaction,” says Anya Mashaney, AHWD, C2EX, a broker with Spaces Real Estate in Oklahoma City who serves on the Oklahoma Association of REALTORS® Government Affairs Committee.

“I started reading through them and I was appalled. Honestly, I couldn’t believe that it’s just commonplace for the title company to upload them and send them in an email,” Mashaney says. “As I’m skimming through, I almost don’t want to send this to my client because it is just so appalling. That was the first time I became aware that this language was still in existence in our currently recorded covenants and restrictions.”

So, when the Oklahoma State Legislature introduced a bill in 2023 to allow property owners to renounce discriminatory language in land records, OAR made it a top advocacy priority.

Thompson joined other real estate professionals from the state for OAR’s REALTOR® Day at the Capitol. “We all went to our legislators and talked about how we felt that this was really important,” she says. After the bill was signed into law last May, the bill’s lead author, Rep. John Pfeiffer, thanked Oklahoma REALTORS® for championing the effort.

Forging a New Legacy

In recent years, a patchwork of similar legislation has been introduced in counties and states across the country, often with the support of REALTORS®. To standardize this effort, the Uniform Law Commission (ULC) recently drafted model legislation, the Unlawful Restrictions in Land Records Act, to “allow all property owners who encounter these harmful and unlawful restrictions to address the issue inexpensively and without needing an attorney.” According to Jane Sternecky, legislative counsel at the ULC, the legislation preserves the insurability of title and historical record while taking “a conclusive step away from the painful past.” Looking ahead to 2024, ULC anticipates introductions of the legislation in Arizona, Colorado, Missouri, Nebraska, New Jersey, Virginia and Washington.

Earlier this year, Washington State took a significant step beyond symbolic renunciation to provide a path towards material repair. Washington REALTORS® successfully advocated for state legislation to provide down payment and closing cost assistance “to people, or heirs, impacted by racially restrictive covenants.” The Covenant Homeownership Program is funded by a $100 increase to the document recording fee assessed on real estate transactions. The program is estimated to raise $75 million per year for homeownership.

In an op-ed in the Washington News Tribune, 2023 Washington REALTORS® President Alisha Harrison, wrote, “Those who were barred from home ownership didn’t just suffer personally, their children and grandchildren continue to pay the price.” Harrison, AHWD, C2EX, continued, “As a mechanism, creating a new homeownership account for descendants of those who were denied housing opportunities is simple; as a solution, its effects will be profound.”

At the federal level, REALTORS® strongly support the Mapping Housing Discrimination Act, a bill sponsored by Senator Tina Smith of Minnesota. In an official letter of support, NAR wrote, “For many decades, restrictive covenants inserted into deeds and mortgage documents codified exclusion, divided communities and locked many Americans out of the benefits of property ownership… REALTORS® are committed to confronting the legacy of historic discrimination, closing the racial homeownership gap, and building vibrant, thriving communities where everyone can flourish.”

Seventy-five years after Shelley v. Kraemer, REALTORS® are a driving political force in their communities to redress harm and support a more equitable future. Through the Fair Housing ACT! program and other initiatives, REALTORS®, will continue to work hand in hand with governments, allied professionals, and buyers to close the racial homeownership gap and make homeownership accessible for all.

Source: Brennon Thompson; https://www.nar.realtor/magazine/real-estate-news/law-and-ethics/truth-and-reconciliation

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