Setting the Record Straight on Fair Housing

The directive that communities affirmatively further fair housing was baked into the original Fair Housing Act of 1968. HUD’s recent weakening of the rule is a step backward in the drive toward equal housing opportunity for all.

three friend riding bikes and skooters on neighborhood street

Key takeaways:

The original text of the 1968 Fair Housing Act called on HUD and communities receiving federal funds to affirmatively further fair housing by taking active steps to erase racial dividing lines.
A 2015 rule, written in response to criticism from the Government Accountability Office, gave communities tools to examine local barriers to fair housing and develop local solutions.
HUD’s new rule, which purports to preserve neighborhood choice, weakens federal oversight—but not NAR’s commitment to fair housing and equal opportunity for all.

In recent weeks, we’ve seen a flurry of news reports and social media posts on Affirmatively Furthering Fair Housing (AFFH). Unfortunately, misinformation has circulated about actions taken by the current and former administrations to alter the rules. As a leader in expanding homeownership and housing choice, NAR has been working to inform members and the public about where this regulation comes from, what it means, and how it would affect REALTORS®.

The “affirmatively furthering” provision of the federal Fair Housing Act is not new. It comes from the original text of civil rights legislation passed by Congress in 1968 in the wake of the assassination of Martin Luther King Jr. The provision directed the U.S. Department of Housing & Urban Development to ensure that neither the agency itself nor the cities, counties, or states it funds make decisions that further entrench patterns of segregation. In passing that landmark law, the 90th Congress directed HUD and the recipients of federal funds to take active steps to promote equal housing opportunity and to erase the racial dividing lines that the government itself had helped to draw.

At the time of the Fair Housing Act’s passage, lawmakers were keenly aware of the federal government’s extensive role in creating and perpetuating America’s racially divided communities. Through early- and mid-20th century policies, which included the denial of federally backed loans in “redlined” neighborhoods, funding construction of suburban developments where restrictive covenants barred non-whites from buying homes, and the denial of the full benefits of the GI Bill to Black service members returning from WWII, the federal government provided support for white Americans to transition from renting to homeownership while locking Black Americans out of these opportunities. By the time of the Fair Housing Act’s passage, the homeownership gap and the resulting wealth gap were cemented into place, affecting the wealth and prospects of families for generations, up to and including today.

Behind the 2015 Rule

Unfortunately, too many jurisdictions accepted HUD funds but failed to fulfill the obligation to actively promote fair housing. For example, one community used HUD funds to build a water system that served only white neighborhoods. In 2010, the Government Accountability Office criticized HUD’s implementation of the Fair Housing Act’s AFFH requirement. A regulation was enacted in 2015 to address these concerns.

When the 2015 AFFH rule was introduced, NAR offered public comments. While we believed that the regulation was more complex than necessary and cumbersome for some communities, we supported the underlying objectives and substance. We believed then, and do now, that REALTORS® and communities thrive when state and local governments take active steps to expand homeownership, invest in all communities, and eliminate discrimination in the housing market.

The 2015 AFFH rule provided recipients of HUD funds with tools to allow them to examine local patterns of segregation and discrimination and to propose a locally driven plan for addressing these problems. It did not prescribe federal policies for local governments to adopt. It was up to the funding recipient to engage in a community process to uncover its own problems and propose its own solutions. While, in theory, a recipient’s failure to submit such a plan could result in HUD withholding funds, this never happened in practice.

2018 and 2020: A Weakening of Fair Housing

Implementation of the 2015 rule was halted in 2018 by the new administration. HUD sought input on what the department should consider in a new AFFH rule. At that time, NAR commented on the importance of allowing communities to determine for themselves what fair housing problems they face and how best to address them, while urging HUD to ensure that communities continue to reflect on and assess how current patterns of segregation can be traced to past public and private policies. Then, in 2020, HUD issued a proposed rule that eliminated any obligation for recipients of its funds to examine and address segregation and emphasized instead housing production. Months later, HUD issued a final rule, “Preserving Community and Neighborhood Choice,” that scarcely resembled the proposed rule and required even less of recipients. NAR expressed disappointment that HUD had chosen to weaken this critical provision of the Fair Housing Act.

Over the past 100 years, NAR has evolved from an organization that prohibited integration in its Code of Ethics to one that is a leading advocate for fair housing rights. Our members benefit from strong, inclusive communities and expanding homeownership. NAR is committed to ensuring that REALTORS® work actively to fight discrimination in their communities and to provide every potential homeowner access to the home of their choice in the neighborhood of their choice.