Real estate racism exposed: Coldwell Banker settles for housing discrimination on Long Island

March 16, 2023 Robert Abruzzese
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STATEWIDE — Attorney General Letitia James announced on Wednesday a settlement with Coldwell Banker, putting an end to the real estate brokerage’s alleged discriminatory practices against Black, Hispanic, and other homebuyers of color on Long Island, which is considered by some to be the most segregated part of the United States.

“There is zero tolerance for discrimination of any kind in New York state,” said Attorney General James. “My office’s investigation into Coldwell Banker uncovered a persistent pattern of prospective homebuyers receiving different treatment because of their race. Discriminating against people because of race is not just shameful — it is illegal. Housing is and always will be a human right, and my office will continue to address these pervasive and discriminatory practices statewide.”

The settlement comes after the Office of the Attorney General (OAG) launched an investigation into Coldwell Banker and other brokerages following Newsday’s investigative report on housing discrimination.

The OAG found evidence that Coldwell Banker agents may have subjected prospective homebuyers of color to different requirements, steered them towards predominantly non-white neighborhoods, and engaged in other biased behavior. As part of the settlement, Coldwell Banker will pay $20,000 in penalties, $10,000 to Suffolk County to support fair housing law enforcement and compliance, provide fair housing training to its agents, and make a discrimination complaint form available on its website.

The investigation was initiated in 2019 after Newsday exposed several brokerage firms’ discriminatory practices, involving five paired tests conducted on Coldwell Banker agents in Great Neck, East Setauket, Bellmore and Massapequa Park.

Agents were found to have warned white homebuyers about diverse neighborhoods but withheld such information from Black and Hispanic homebuyers. In one case, an agent showed a white homebuyer properties in 83 percent white neighborhoods while showing a Black homebuyer properties in a more diverse neighborhood of Freeport.

This news is a reminder that “redlining” has not been eliminated and still plays a role in where people live throughout the State.

Redlining is a discriminatory practice that began in the United States in the 1930s, when the Home Owners’ Loan Corporation created color-coded maps to assess the creditworthiness of neighborhoods. The term “redlining” originates from these maps, where the riskiest areas — usually those inhabited by African Americans and other minority groups — were marked in red. This practice led to racial segregation, disinvestment, and long-lasting disparities in wealth and opportunities in many American cities, including New York.

In New York, redlining affected various neighborhoods, especially those with predominantly Black or immigrant populations. Areas like Harlem, Bedford-Stuyvesant, and the South Bronx experienced severe disinvestment as a result of redlining. Banks and other financial institutions were less likely to grant loans or provide mortgages to residents in these neighborhoods, leading to reduced investment in housing, businesses, and public services.

Redlining was reinforced by racially restrictive covenants in housing deeds, which explicitly prohibited the sale or rental of properties to certain racial or ethnic groups. These practices were eventually declared illegal by the Fair Housing Act of 1968, which aimed to prevent discrimination in housing based on race, color, religion, or national origin.

Long Island has been described as one of the most racially segregated regions in the United States. This segregation is a result of several historical and ongoing factors, including discriminatory housing practices, exclusionary zoning, and economic disparities. The phenomenon of “white flight,” in which white families moved to suburban areas to escape racial integration in urban centers, also contributed to Long Island’s segregation.


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