In one of the most concentrated investigations of discrimination by real estate agents in the half century since enactment of America’s landmark fair housing law, Newsday found evidence of widespread separate and unequal treatment of minority potential homebuyers and minority communities on Long Island. The three-year probe strongly indicates that house hunting in one of the nation’s most segregated suburbs poses substantial risks of discrimination, with black buyers chancing disadvantages almost half the time they enlist brokers. Additionally, the investigation reveals that Long Island’s dominant residential brokering firms help solidify racial separations. They frequently directed white customers toward areas with the highest white representations and minority buyers to more integrated neighborhoods. They also avoided business in communities with overwhelmingly minority populations.

The findings are the product of a paired-testing effort comparable on a local scale to once-a-decade testing performed by the federal government in measuring the extent of racial discrimination in housing nationwide. Regularly endorsed by federal and state courts, paired testing is recognized as the sole viable method for detecting violations of fair housing laws by agents.

Two undercover testers – for example, one black and one white – separately solicit an agent’s assistance in buying houses. They present similar financial profiles and request identical terms for houses in the same areas. The agent’s actions are then reviewed for evidence that the agent provided disparate service. Newsday conducted 86 matching tests in areas stretching from the New York City line to the Hamptons and from Long Island Sound to the South Shore. Thirty-nine of the tests paired black and white testers, 31 matched Hispanic and white testers and 16 linked Asian and white testers.

Newsday confirmed that agents had houses to sell when meeting with testers based on analyses provided by Zillow, the online home search site. Zillow draws an inventory of available homes daily from the Multiple Listing Service of Long Island, the computerized system used by agents to select possible houses for buyers. MLSLI said that it does not maintain its own database of past daily inventories, as Zillow does, and so could not provide the same type of tallies. As permitted by law, all tests were recorded on hidden cameras to ensure accuracy in describing interactions between agents and customers.

Newsday relied on two nationally recognized experts in fair housing standards to evaluate the agents’ actions. The consultants were:

• Fred Freiberg, who co-founded the Fair Housing Justice Center in 2004. Previously, he had led a national testing program for the Civil Rights Division of the United States Department of Justice, as well as two national paired testing programs for the Urban Institute. He has coordinated more than 12,000 fair housing tests. He was paid to help organize the testing and train the testers but was not paid to evaluate test results.
• Robert Schwemm, the Everett H. Metcalf Jr. Professor of Law at the University of Kentucky College of Law. Schwemm is the author of “Housing Discrimination: Law and Litigation,” widely accepted as the definitive treatise of the subject. Schwemm assisted on an unpaid basis.

Newsday separately gave Freiberg and Schwemm summaries of tests that preliminarily appeared to show evidence of unequal treatment; transcripts of relevant remarks made by agents; and maps of the listings suggested to testers, along with the average percentage of white population in the census tracts where the listings fell. An agent’s actions were deemed worthy of citing only after both consultants independently saw evidence of fair housing violations in response to the information provided by Newsday. While their opinions do not represent legal findings, their matching independent judgments provided a measure of apparent disparate treatment by the tested agents.

In fully 40 percent of the tests, evidence suggested that brokers subjected minority testers to disparate treatment when compared with white testers with inequalities rising to almost half the time for black potential buyers. Black testers experienced disparate treatment 49 percent of the time – compared with 39 percent for Hispanic and 19 percent for Asian testers. In seven of Newsday’s tests – 8 percent of the total – agents accommodated white testers while imposing more stringent conditions on minorities that amounted to the denial of equal service between testers.

“This is something that didn’t happen in the deep South,” said Greg Squires, professor of public policy at George Washington University in Washington, D.C., who offered advice about structuring the testing program. “It happened in one of the most educated, most liberal regions of the country. These are significant numbers.”

Most commonly in the seven cases, agents refused to provide house listings or home tours to minority testers unless they met financial qualifications that weren’t imposed on white counterparts. “I won’t do it,” Signature Premier Properties agent Anne Marie Queally Bechand said in refusing to take a black customer to tour houses unless the customer produced evidence that a lender had preapproved a mortgage loan. One month earlier, Queally Bechand had asked a white customer who had yet to secure mortgage preapproval, “When can you start looking at houses?”

In nearly a quarter of the tests – 24 percent – agents directed whites and minorities into differing communities through house listings that had the earmarks of “steering” – the unlawful sorting of home buyers based on race or ethnicity. One example: Amid MS-13 gang murders in Brentwood, a 79 percent Hispanic and black community, Le-Ann Vicquery, at the time a Keller Williams Realty agent, told a black customer: “Every time I get a new listing in Brentwood, or a new client, I get so excited because they’re the nicest people.” She emailed the paired white customer: “please kindly do some research on the gang related events in that area for safety.” Vicquery declined to comment. Queally Bechand did not respond to requests for comment.

Altogether, agents provided white testers an average of 50 percent more listings than they gave to black counterparts – 39 compared with 26. There was no such gap in paired testing for other minorities. Agents gave both Hispanic and white paired testers an average of 42 listings. Asians received 18 compared with 22 given to paired white testers. The averages include cases in which agents provided no listings to one or the other customer. In some cases, agents keyed on the racial, ethnic or religious makeup of communities when speaking with testers, in all but one sharing the information only with white customers.

Fair housing standards generally bar agents from talking about the backgrounds of people who live in neighborhoods as a form of verbal racial or ethnic steering. The standards also require agents to provide equal guidance to customers about areas in which they may want to live.

Century 21 agent Raj Sanghvi, for example, warned a white tester about buying in Huntington, a mainstay of northern Suffolk County. “But you don’t want to go there. It’s a mixed neighborhood,” Sanghvi said, adding, “You have white, you have black, you have Latinos, you have Indians, you have Chinese, you have Koreans; everything.” Sanghvi made no similar remarks to an Asian tester and suggested no Huntington houses to either tester.

Speaking to a white tester about one overwhelmingly minority community, RE/MAX agent Joy Tuxson promised, “I’m not going to send you anything in Wyandanch unless you don’t want to start your car to buy your crack, unless you just want to walk up the street.” Talking to an Asian tester about another largely minority area, Tuxson said she had told a family member, “Do you really want your future children going to Amityville School Districts?” Sanghvi and Tuxson did not respond to multiple requests for comment.

To capture broad swaths of Long Island, Newsday divided most of Nassau and much of Suffolk into 10 zones that included housing markets with affordable homes as well as million-dollar mansions and places where large groups of minorities live closely to white populations. The zones ranged from western Nassau to the Hamptons. Newsday conducted tests in each zone and plotted the housing choices made by agents in each area, often revealing the communities they favored for buyers of varied backgrounds. Cumulatively, the 10 zones encompassed 83 percent of Long Island’s population, including 80 percent of the white population and 88 percent of the minority population.

Overall, the agents gave black customers their smallest share of listings in towns with the highest proportions of white residents and their biggest share where whites were less prevalent. Where whites composed 20 percent or less of the population, agents provided seven out of 10 listings to minorities. Only when whites hit 56 percent of the population did agents give most of the listings in a community, 63 percent, to whites. Agents and brokers bear the responsibility for applying fair housing standards as they act as licensed gatekeepers to housing choices. Industry representatives have contended that proper training is the best way to ensure agents uphold fair housing laws, arguing against more aggressive enforcement through fines, license suspensions or revocations.

To assess the quality of training, Newsday attended six fair housing classes sponsored by the Long Island Board of Realtors. Experts who reviewed the instruction found that only one covered the material adequately and that others were “shockingly thin in content.” After the testing was completed, Newsday revealed to testers for the first time how their counterparts had fared in visiting agents. The testers heard the comparisons sitting side by side – black beside white, Hispanic beside white, Asian beside white. Often, they said the test results brought to light evidence of discrimination that had been hidden behind the smiles and handshakes offered by guides to housing in a suburb where the racial lines between many communities are starkly drawn.

Martine Hackett, who is black and a tenured professor of public health at Hofstra University, had met with seven agents and encountered evidence of disparate treatment three times. Her thoughts encapsulated the perspectives of many fellow testers. “I would have no idea that, without this testing, that there was even a difference between what was provided. My assumption would be that everybody would be provided with the same listings based on their economic and geographic requirements,” Hackett said, adding: “To sort of have the options to be limited in that way sort of makes me think about what options are available that people might not know about. And who’s making those choices? That’s the other thing that I feel, is that the choice, in terms of the choice of what would be theoretically the best choice for me and my family, was sort of removed.”

Another tester, Alex Chao, an actor who is Asian, learned that an agent had declined to provide him listings of houses for sale, a first step in a home search, but had given listings to his matched white tester. He called the difference in treatment deeply disturbing. “I don’t think I was treated fairly at all,” he said. “That’s pretty outrageous and, of course, offensive, upsetting to find out. You know you read about these things, you never think they would happen to you.”

Newsday’s investigation focused on 12 brands that represented more than half of the Island’s home sellers in 2017. They included Douglas Elliman, Century 21 Real Estate LLC, Charles Rutenberg Realty Inc., Coldwell Banker Residential Brokerage on Long Island, Coach Realtors, Daniel Gale Sotheby’s International Realty, Laffey Fine Homes, Keller Williams Realty, The Corcoran Group, Signature Premier Properties, Realty Connect USA and RE/MAX LLC. Tests of agents associated with two of the firms–The Corcoran Group and Daniel Gale Sotheby’s–produced no evidence of disparate treatment. Newsday notified the 93 agents by letters that they had been tested and recorded.

When Newsday’s two fair housing consultants found evidence suggesting disparate treatment, the letters detailed the facts so agents could review their records, specified the findings, gave agents the opportunity to view videos of their actions and invited them to provide their perspectives in interviews or written statements. Additionally, Newsday delivered the identical information and opportunities for discussion and comment to the agents’ corporate leaders. Thirteen agents and 21 corporate representatives came to Newsday and viewed materials for 26 paired tests that involved eight agencies.

Ultimately, fair housing violations are determined by the courts or enforcement agencies. Authorities may choose to file charges based on egregious conduct in a single case. More generally, they bring legal action after subjecting an agent to several paired tests to establish a pattern and to reduce the likelihood that an agent’s choices were either a fluke or soundly guided by the market at the time. Newsday tested each agent only once. Falling short of proving legal wrongdoing, each result points to evidence of neutral or disparate treatment in a single comparison of customer contacts and offers little insight into an agent’s general professional conduct.

Collectively, however, the individual test results, bolstered by the statistical findings, form a body of evidence suggesting the extent of discriminatory practices by agents in Long Island home sales.

Additionally, read side by side, the matched transcripts uniquely revealed the hidden disparities experienced by minority house hunters without their ever knowing they had been disadvantaged.

By Ann Choi, Keith Herbert, Olivia Winslow and project editor Arthur Browne for Newsday

For extensive coverage, including videos and detailed maps, please click here: https://projects.newsday.com/long-island/real-estate-agents-investigation/#nd-promo