Industry Perspectives with Anthony Marguleas: Combatting Persistent, Pervasive Issues in Fair Housing and Appraisal Practices

Leverage

Real estate represents an incredible opportunity to build and pass down generational wealth, but it still remains disproportionately out of reach for many people.

Hurdles to property ownership go far beyond the individual and into the systemic, with archaic rules and discriminatory practices still prevalent today.

Anthony Marguleas of Amalfi Estates takes a specialized interest in advocating for industry-wide awareness and education on these critical issues, especially in the state of California. Marguleas sat down for a conversation with Leverage on how real estate professionals play a vital role in tackling the roadblocks that prevent all people from accessing and leveraging the possibilities of real estate.

The Fight For Fair Housing Wages On

The Federal Fair Housing Act was enacted in 1968, 100 years after the 14th Amendment granted citizenship to all persons born or naturalized in the United States and guaranteed “equal protection of the laws.” However, housing discrimination is deeply embedded despite legislation.

According to a report by the National Fair Housing Alliance, “there were 31,216 fair housing complaints received by private non-profit fair housing organizations, HUD, FHAP agencies, and the DOJ in 2021.” This represents an 8.7 percent increase over complaints filed in 2020.

The report found the top five discrimination complaints included:

Disability: 16,758 complaints (53.68% of all cases)
Race: 5,922 complaints (18.97% of all cases)
Sex (including complaints based on sexual orientation or gender identity): 2,309 complaints (7.40% of all cases)
Familial status: 2,261 complaints (7.24% of all cases)
National origin: 1,774 complaints (5.68% of all cases)

“Even though it’s been 150 years since the 14th Amendment and over 50 years since the Fair Housing Act, these issues still plague the industry,” said Marguleas. “Educating yourself is a strong part of enacting change, but action is essential to moving the needle on these issues.”

Discriminatory Appraisal Practices Stand in the Way of Equitable Housing

It’s not only home value that hinges on an appraisal, it’s ultimately the homeowner’s financial standing. There have been many documented cases of wide swings in appraisal numbers based on the homeowner’s race, a trend that threatens home equity and, more importantly, home equality.

According to the U.S. Bureau of Labor Statistics, 97% of property appraisers are white. The lack of diversity in this field contributes to inequities across the board. Not only does it impact individual transactions, but it also has wider implications for the appraisal industry.

“When I first heard that statistic, it really surprised me,” said Marguleas. “If the background of our appraisers doesn’t reflect the background of our communities, there’s going to be an inherent bias in the industry, and that’s where so much of this discrimination stems from.”

Marguleas and his team are committed to surrounding themselves with unique voices and perspectives. By being intentional about their partners and network, the team is constantly looking for new ways to ensure they mirror the vast array of rich, diverse voices in California.

The Devastating History Behind Restrictive Covenants

Small print can have a huge impact. The way Marguleas describes seeing discriminatory language for the first time in writing on real estate documents is “shocking.” The term for this type of language is restrictive covenants, and it is put in place to prevent properties from being bought or sold by a non-Caucasian person.

While restrictive covenants are no longer legal, the language still exists in recorded documents across the country. In September 2021, California signed AB-1466 into law requiring every California County Recorder to review and remove restrictive covenants, then create a redacted version of those documents and re-record them. Homeowners also have the ability to redact and re-record their documents containing restrictive covenants.

“Restrictive covenants are a relic of a sad time, and it’s far overdue to remove this discriminatory language from real estate documents,” said Marguleas.

Meaningful Steps, Big and Small, Towards Actionable Change

While the idea of tackling system-wide injustices can feel overwhelming, it’s important to remember that every action can create positive momentum.

For Marguleas, awareness was the first step. “I knew discrimination existed, but I didn’t know how truly prevalent it was. That’s the jumping off point – becoming more aware of the issues that affect the industry today.”

Education is vital to understanding the nuances of these complex issues. The National Fair Housing Alliance is a great resource for trends, statistics, and in-depth, actionable information. State housing and real estate associations are raising awareness about housing issues in their communities, so deeper involvement with those organizations is a powerful way to amplify your voice.

“Homeownership is possibly the greatest predictor of wealth, and more importantly, generational wealth,” said Marguleas. “As real estate professionals, we have the power put homeownership within reach for more people and create a ripple effect for generations to come.”