Online real estate brokerage Redfin Corp. agreed to stop refusing to provide service to lower-priced homes and will pay $4 million to settle a lawsuit brought by fair-housing groups who claimed the company’s “minimum price policy” disadvantaged non-White buyers and sellers.
The Seattle-based firm also agreed to be monitored by the groups, led by the National Fair Housing Alliance in Washington, and to make other changes to ensure it provides equitable access to real estate services, according to the settlement agreement filed Friday. Redfin didn’t admit liability or wrongdoing.
“This settlement sends a strong message to those throughout the real estate industry,” Morgan Williams, general counsel at NFHA, said in an interview. Minimum-price policies “create an unjustified discriminatory impact and are a violation of federal civil-rights law.”
The fair-housing groups filed the lawsuit in federal court in Seattle in October 2020, alleging that Redfin was more likely to provide its best services and discounts to customers in predominantly White neighborhoods. The groups described the practice as “redlining in the digital age,” harking back to the days when lenders and brokers drew boundaries that restricted service to non-White areas.
A Bloomberg Businessweek investigation published in January found that some of Redfin’s own employees shared the groups’ concerns and had pushed the company to provide more service in minority neighborhoods.
In a statement Friday, Redfin said it will still be able to use home prices to determine whether to serve a customer with its own agents or to refer the person to “partner agents” at other brokerages.
“Redfin hasn’t broken the law and we continue to stand behind our business practices,” the company said. “We recognize there is much to be done to make housing fair and to reverse decades of inequality and we will continue to do our part.”
Redfin is best known for its home-shopping website and app, visited by more than 40 million people a month. The company also employs agents in dozens of markets across the U.S. who use technology to streamline the process of buying and selling homes. This allows them to charge fees that are less than the industry average.
