You’ve Heard of NIMBY (‘Not in My Backyard’). You’ll Be Hearing About YIMBY in 2021.

One of the many bills passed by the Democratic House which Senate Majority Leader Mitch McConnell has not allowed to be acted on in the Senate is the YIMBY Act. If, as may well happen, the Democrats take control of the U.S. Senate in this year’s election, that act could become law next year.

The YIMBY Act (HR 4351) was bi-partisan, co-sponsored by Democrat Denny Heck of Washington and Republican Trey Hollingsworth of Indiana. It was passed on a voice vote by the House of Representatives on Mar. 2, 2020. Here’s a link to the full text of HR 4351.

Here’s how the act is described and promoted at www.UpForGrowth.org:

The Yes in My Backyard (YIMBY) Act encourages localities to eliminate discriminatory land use policies and remove barriers that prevent needed housing from being built around the country.

The YIMBY Act achieves these goals by requiring Community Development Block Grant (CDBG) recipients to report periodically on the extent to which they are removing discriminatory land use policies and implementing inclusive and affordable housing policies detailed by the bill.

The YIMBY Act increases transparency in land use, zoning, and housing decisions; sheds light on exclusionary polices; and ultimately encourages localities to eliminate barriers to much-needed housing.

Background:

According to Up for Growth’s “Housing Underproduction in the U.S.” report, the United States has underproduced housing by 7.3 million homes from 2000 to 2015.

Exclusionary land use policies — including zoning and density restrictions, onerous parking requirements, and other burdensome development regulations — drive a severe housing shortage and affordability crisis.

The “Missing Millions of Homes” report from the New Democratic Coalition shows that the cost of shelter has been the single largest increase in household budgets in the last 15 years and that the median U.S. family now spends 42% of its income on housing.

Housing underproduction also increases cost of living for families, inhibits geographic mobility, burdens both renters and buyers, and stifles economic productivity. By one estimate, from 1964 to 2009, our national housing shortage lowered aggregate economic growth by 36 percent.

Many of these land use policies are rooted in racism and classism. Their continued existence perpetuates housing discrimination and contributes to the housing affordability crisis affecting large parts of the United States.

Legislative Solution:

The YIMBY Act increases transparency and encourages more thoughtful & inclusive development practices by requiring localities to fully examine and disclose their housing policy decisions.

The bill provides localities a framework for smart policymaking and regulatory practices, thus promoting more inclusive development principles.

The YIMBY Act is an important first step in decreasing the barriers to smart, inclusive growth and reducing the negative and cumulative impact of exclusionary housing policies. It is also a way to clearly demonstrate that the federal government takes seriously the challenges created by exclusionary zoning.

This proposal has not escaped the attention of conservatives, who consider it an attack on suburbia, primarily by eliminating single-family zoning. Allowing greater density and making housing more affordable means to them the introduction of lower-income and therefore racially diverse populations into communities which are historically white and upper-middle or upper income neighborhoods. It’s worth noting that it’s an argument that does indeed divide conservatives from liberals and, because of how it is being promoted, will be a factor in this year’s election.

However, we should remember that zoning laws are matters of local debate and enactment and cannot be forced upon localities by the federal government. That’s why the YIMBY Act only asks localities to consider the implications of their zoning decisions. Single-family zoning will only be modified or eliminated gradually if at all over time and only by a vote of locally elected representatives on city councils and county boards of commissioners. Voters would be wise to recognize fear mongering on the subject for what it is and to consider the underlying motives.

Moreover, it is inconceivable that an established and fully built out subdivision, especially one with a healthy housing stock under 30 or 40 years old, would see any effects from zoning changes. Instead you might see the legalizing of ADUs (Accessory Dwelling Units), which are already popular in many jurisdictions. These units can be in walk-out basements or above detached garages, and provide a great solution for modestly increasing a neighborhood’s and city’s density.

What we are already seeing in the older communities with pre-1970 bungalows is the scraping of isolated homes, making way for attached townhomes. Again, this is only done by the enactment of zoning changes by your elected officials who are not going to act in opposition to their constituents’ loudly expressed viewpoints.

No matter who is elected on the national level or what legislation is passed, housing will always be an expression and result of very localized democratic control — that’s democratic with a small “D.”

Moreover, the YIMBY Act would only apply to localities which accept Community Development Block Grants, for which no community needs to apply.

Realtor Association Takes Fair Housing Seriously

While it might be popular to think of Realtors as privileged conservatives (mostly Republicans) who put up with but are not fans of federal civil rights laws, quite the opposite appears to be true now. Liberal thinking Realtors are in ascendance.

An August 22 article from Realtor Magazine, the official magazine of the National Association of Realtors, makes this abundantly clear.

In 2018, NAR leadership laid bare at its legislative meetings in Washington, D.C., the organization’s “immutable past support of discriminatory and racist practices [link],” vowing to deepen its commitment to industry inclusivity and equal opportunity in housing.

The Chicago Association of Realtors, headed by an African-American woman, apologized last year for its “historically racist policies that persisted for decades.”

Click on that link above. Unless you miss the “good old days,” you’ll be heartened by what you read. It makes me proud to be a Realtor. The commitment to equality and justice is rock solid.

A Fair Housing Violation Could Ruin a Real Estate Professional’s Career

From my first classes in real estate, back in 2002, I was made aware of our obligation under law as well as under the Realtor Code of Ethics, to avoid even the hint of racial and other discrimination, including “steering” buyers to or from neighborhoods based on race or other criteria.

We continue to be warned about “testers” from the U.S. Department of Housing & Urban Development who pose as buyers to see whether we are in fact engaging in steering or other discriminatory practices.

I am reminded of this topic by an article in the current issue of Realtor Magazine about “The Gentrification Conversation.”  You are probably familiar with this term, which refers to the upscaling of traditionally poor and usually minority neighborhoods, resulting in the displacement of minority homeowners and tenants as they are priced out of their long-time neighborhoods.

While we don’t see a lot of gentrification in our suburban counties, it has been and remains an issue in inner cities such as Denver, and I see it a lot in West Denver, between Sheridan Blvd and I-25.

The Realtor Magazine article talked about the large-scale gentrification taking place in Detroit and about the deployment of HUD testers:

“An investigation by Newsday [a Long Island daily newspaper] published in November found disparate treatment and evidence of fair housing violations when undercover testers posing as home buyers visited real estate agents throughout Long Island, N.Y. A total of 93 agents were tested over three years, and the probe found unequal treatment occurred 49% of the time with black testers, 39% with Hispanic testers, and 19% with Asian testers. Unequal treatment included showing minority testers fewer properties, steering testers toward certain neighborhoods, and refusing to serve minority testers who weren’t preapproved for financing but not requiring the same for white testers. Agents also used euphemisms to communicate the racial makeup of an area and imply racial bias.

“[National Association of Realtors] President Vince Malta says he was deeply troubled by Newsday’s findings…. ‘NAR maintains its strong support of fair housing testing to unmask housing discrimination and hold our industry to the highest standard,’ he says.”

It should be noted that race is only one of several “protected classes” under both state and federal laws.  The federal Fair Housing Act of 1968 also prohibits discrimination based on sex, color, religion or creed, national origin and disability. Colorado law goes further, prohibiting discrimination based on sexual orientation (including transgender), gender identity, and familial status (single, married, having children under 18, being pregnant, etc.).

Avoiding fair housing violations can be tricky. Did you know that hoarding and peanut allergies are classified as disabilities?  Or that age discrimination is not prohibited in Colorado?  Or that drug addiction is protected as a disability, but illegal drug activity isn’t?  Or that you can’t discriminate based on how a person earns their income?  Or that you can be held liable for violating the Fair Housing Act even if you did not intend to discriminate?

The Realtor Magazine article provides guidance on how to avoid committing a fair housing violation.  For example, we cannot answer questions about a neighborhood’s demographics, but we can provide a neighborhood report from Realtor Property Resource (RPR) which does provide such information. We cannot characterize a neighborhood’s level of crime, but must refer the buyer to the local police department.

We can avoid “steering” by entering the buyer’s search criteria into the MLS and letting the computer pull all listings matching those search criteria.  We can enter geographical criteria such as city or draw an area on a map, as long as we are following the buyer’s request and are not knowingly avoiding one area or another based on discriminatory preferences.

If a buyer asks us to help them identify areas based on discriminatory criteria, we are advised to decline to serve that buyer. Since I have never had a buyer make such a request, I would suspect such a buyer to be a HUD tester.

The trickiest conversation to navigate would be one asking about the trends in a given neighborhood.  Is it “going up” or “going down”?  All we should do is provide actual statistics about the past few years, just giving the numbers, but no interpretation of them that could include demographic changes.

I can’t recall dealing with a buyer who presented a fair housing challenge, and I make an effort to stay aware of fair housing laws and understand the importance of non-discrimination.  However, it can be a challenge keeping up with current housing laws, as suggested by those questions I posed above.