Long Island

Part 6

Fewer hurdles for Asian buyers

No signs of steering, but they experienced evidence of disparate treatment 19% of the time.

Alex Chao Payal Mehta Eugene Cha

While searching for homes with prices ranging from $400,000 in the Bay Shore and West Islip area to $7 million on the North Shore Gold Coast, Asian house-hunters met evidence suggesting discrimination less often than black and Hispanic peers in Newsday’s paired testing of real estate agents.

The Asian would-be home buyers – one Chinese American, one Korean American, one South Asian American – participated in 16 tests that measured the service agents gave to them against how the agents helped comparable white buyers.

In all but three, agents provided comparable service to Asian and white house hunters. The three exceptions included evidence that one agent denied equal service to an Asian tester compared with his white counterpart and that two agents provided greater information about communities to white testers – even as the agents disparaged those areas.

None of the tests matching Asian and white buyers showed evidence that agents had steered house hunters to different communities.

At three out of 16 tests, the individual Asians experienced evidence suggesting discrimination 19 percent of the time – a frequency far less then met by black (49 percent) or Hispanic (39 percent) testers.

That rate reflected apparent personal discrimination against Asian testers. Two additional tests suggested possible violations of fair housing standards that restrict agents from volunteering the racial, ethnic or religious makeup of communities to customers. In those two tests, agents pointed out a growing Asian presence in an area to potential white buyers.

“It would probably always be questionable to raise those kinds of matters if the home seeker didn’t ask about them,” said Robert Schwemm, a professor at the University of Kentucky College of Law and authority on the fair housing act, who served as Newsday consultant. “There is clear law that says steering can occur based on statements about racial makeups that are unsolicited by the home seeker.”

Asians made up 6 percent of Long Island’s population in 2017, according to the latest U.S. census estimate.

The majority live in Nassau County, where they are more dispersed than black residents. Half of the Asian population lives in 28 communities, while half of black residents live in just 11.

In Suffolk County, Asians made up 4 percent of the population in 2017 and are most highly concentrated in Stony Brook – thanks mainly to Stony Brook University, where the census counts 45 percent of the population as Asian.

Among all Asians across Long Island, Asian Indians made up 37 percent of the population, followed by Chinese, Koreans and Filipinos.

Asian testers received an average of 18 listings from agents in Newsday’s investigation, compared with 22 for their paired white testers. Collectively, the agents concentrated the listings provided to Asian and white testers in neighborhoods with similar proportions of white residents.

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Asians made up 10 percent or more of the population in 59 Long Island communities, or one in every five.

All but eight of those were in Nassau County, from South Floral Park village, where Asians made up 10 percent of the population, to Garden City Park, where Asians made up 44 percent of the community. Hicksville was home to the largest number of Asians, just shy of 10,000.

The number of Asians in Nassau County has grown. Between 1990 and 2017, their proportion of the population has risen from 3 percent to 9 percent, or 123,000 people.

They have become a presence, for example, on the Island’s upscale Great Neck peninsula, home to 41,000 people on almost 10 square miles of land that extends into Long Island Sound near the border between Nassau County and Queens. Multimillion-dollar house prices are common.

Largely composed of people with Chinese and Korean backgrounds, many of them first-generation immigrants, the peninsula’s Asian representation climbed from 7 percent of the population to 18 percent in 2017.

With more than a quarter of the group below the age of 18, the children make up more than one-third of the school-age population. Their addresses channel the students to one of two high schools: Great Neck North, where, according to state statistics, Asians composed 15 percent of the student body in the last school year, and Great Neck South, where the proportion topped half.

At the same time, a peninsula that has long had a strong Jewish representation has drawn a growing number of Orthodox Jews among immigrant families with Iranian, Middle Eastern and Russian heritages.

The two tests that touched on Asian community characteristics occurred in home searches on the Great Neck peninsula, also known as Long Island’s Gold Coast.

Test 10

We got a lot of Chinese, Oriental coming in Great Neck…

Akhtar Somekh

Coldwell Banker

Great Neck

White and Hispanic testers separately consulted Coldwell Banker agent Akhtar Somekh about purchasing $2 million houses in the villages and hamlets that cover the peninsula. Somekh praised the schools but described their racial composition only to white buyer Kimberly Larkin-Battista and not to Hispanic customer Nana Ponceleon.

Speaking of areas served by Great Neck North and Great Neck South High Schools, Somekh told Larkin-Battista:

“Kensington and Great Neck Estates has a choice between North and South. Before it was only South. Recently we got a lot of Chinese, Oriental coming in Great Neck. In the beginning, they start going to South because they have their friends and family, everybody South. And it became overwhelmed.”

Somekh added: “Usually, the great thing about Great Neck is they keep their amount of students smaller than 20. They tried to do it but South school, when it became very crowded, so they gave Kensington and Great Neck a choice of North or South.”

Based on information provided by Newsday, fair housing consultant Fred Freiberg, executive director of the Fair Housing Justice Center, concluded:

“The agent should not have described the racial makeup of a specific high school as being overwhelmed with ‘Orientals, Chinese’ when meeting with the white tester. This negative statement, which was not made to the Hispanic tester, appears to indicate a preference or limitation based on race or possible steering by discouraging the white tester from considering the area served by this school.”

Newsday’s second consultant, Schwemm, found:

“There was a difference in treatment between the white and Hispanic tester in the form of a blatant statement by the agent about the school’s demographics. The statement suggests a possible fair housing violation, with the town/school as potential plaintiff.”

Test 11

We have a lot of Asian people in Great Neck…

Rosalind Resnick

Coldwell Banker

Great Neck

Coldwell Banker agent Rosalind Resnick described both Asians and Orthodox Jews as living in the Great Neck area when speaking with white tester Brittany Silver but not with black tester Martine Hackett as each sought $5 million homes.

Resnick described the area to a white tester as “very mixed, more than it ever was.”

“We have a lot of Orthodox people in Great Neck,” she said. “We have a lot of Asian people in Great Neck. So it is – you know, it’s like that kind of a mixed community, which is …”

“Wonderful,” said white tester Silver.

“… Fine, which is good,” Resnick said, adding, “Nothing bad about any of it, is what I guess what I’m trying to say. They’re all beautiful neighborhoods.”

Shortly, she asked Silver, “Are you religious at all?” Told no, Resnick said, “Well, then that was really my way of asking – because some people are, they were Orthodox, and they want to live near a temple.”

Wrote Schwemm: “What you’re dealing with is an agent who talks about racial and demographic makeups to the white tester and doesn’t mention any of that to the black tester. And that’s inappropriate.

“It would probably always be questionable to raise those kinds of matters if the home seeker didn’t ask about them. There is clear law that says steering can occur based on statements about racial makeups that are unsolicited by the home seeker.

“It’s clearly something she thinks is bonding her to this customer, and it’s unfortunate that she thinks what bonds her to the white customer is demographic information and that she doesn’t think the minority customer is worth bonding with over demographic information.” Freiberg found: “It was inappropriate for the agent to make statements about the racial or religious makeup of a community.

“Such statements are specifically prohibited by the Fair Housing Act. Agents should not make statements that indicate a limitation or preference based on any protected characteristics, including race, national origin and religion.”

Somekh and Resnick showed no evidence of steering in the house suggestions they offered white and minority buyers. Informed by letter of Newsday’s findings, the two agents did not respond to an invitation to view video recordings of their meetings with testers or to follow-up emails and phone calls requesting interviews.

Newsday presented its findings by letter to Charlie Young, president and chief executive officer of Coldwell Banker Residential Brokerage. The letter conveyed the actions of Resnick and Somekh and additional Coldwell Banker agents.

The company’s national director of public relations, Roni Boyles, wrote in an emailed statement:

“Incidents reported by Newsday that are alleged to have occurred more than two years ago are completely contrary to our long term commitment and dedication to supporting and maintaining all aspects of fair and equitable housing.

“Upholding the Fair Housing Act remains one of our highest priorities, and we expect the same level of commitment of the more than 750 independent real estate salespersons who chose to affiliate with Coldwell Banker Residential Brokerage on Long Island. We take this matter seriously and have addressed the alleged incidents with the salespersons.”

Coldwell Banker declined to discuss the company’s responses to specific cases.

Mimi Hu, a Great Neck Library Board trustee, said she is aware of racial tension in the Great Neck school district. Hu’s son attends the Saddle Rock Elementary School and said she has heard fellow parents make generalizations about Asian students.

Learning that a real estate agent described Asians or “Orientals” as having “overwhelmed” the school district, Hu responded: “I don’t see anyone who would take that lightly.”

The relative equality of service provided to Asian testers when compared with black and Hispanic buyers made evidence suggesting individual discrimination no less stinging.

Following are three case histories that show evidence of the disparate treatment hidden in house hunting by Asians. They are accompanied by the findings of fair housing consultants Fred Freiberg, executive director of the Fair Housing Justice Center, and Robert Schwemm, professor at the University of Kentucky College of Law.

The opinions of Freiberg and Schwemm are based on data provided by Newsday. Their judgments are not legal conclusions.

The case histories each include the experts’ findings, and responses of agents and the companies they represent.

TEST 70

Agent gives white tester tour without mortgage preapproval, balks at Asian tester’s request for listings

In September 2016, tester Alex Chao sought the help of agent Francia Perez in searching for a home within 30 minutes of Bethpage. At the time, Perez worked for RE/MAX Central Properties in East Meadow. She is now a salesperson for Douglas Elliman Real Estate in Massapequa Park.

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Chao told Perez that a retired friend who had worked with a mortgage lender had estimated that Chao could afford a $500,000 home. Chao said he had $120,000 for a down payment.

Richard Helling, a white customer, told Perez that a friend who currently worked with a mortgage lender projected that Helling and his wife could afford a $500,000 house as well. He said he had $130,000 to put down.

Test 70 The house search Within 30 minutes of Bethpage and up to $500,000
Alex Chao
Asian Tester:

Alex Chao


Listings Given:

0


Richard Helling
White Tester:

Richard Helling


Listings Given:

15


Perez introduced both men to a “preferred” mortgage lender who worked in her office.

Chao said he believed his wife had an appointment with a different lender the following week and expected to soon have mortgage preapproval.

“It’s always good to compare,” Perez told Chao, who said he was currently renting but was willing to pay the penalty for breaking his lease if they found the right house.

Helling said he hoped to have preapproval by the end of the next week and was renting on a month-to-month lease that was breakable.

“So, let’s not worry about the lender today,” Helling told Perez. The preferred lender told Perez, “I think he’s OK.”

Unprompted, Perez shortened the anticipated time frame for securing preapproval, saying, “Cause you’re confident that you have the preapproval in a day or two.” Helling said he was confident of his financial calculations.

Perez concluded, “I’m confident that you will get your preapproval, and I will find you a home.”

She provided Helling with listings and a house tour.

Chao told Perez that his wife had said, “I would like to see some listings” so they could “get an idea of what we can get for 500,000.”

Perez balked at suggesting homes, saying:

“When you get preapproved, you get preapproved for an amount and taxes. That’s very important before we do anything. Because if I’m just going to take you out just to look, it’s a waste of my time and your time, because we’re not knowing exactly where you stand as a monthly payment.”

Chao pressed by asking, “Would it be possible, just for our edification, for our education purposes, to just e-mail us some listings that you think would be good for us given all our criteria?” Perez responded that she would email listings that afternoon:

“Okay. So Bethpage, Plainview and Syosset will be areas that I will be e-mailing you. And then we’ll take it from there. And when you’re ready and you have your pre-approval, you’ll e-mail it to me. You say ‘Francia, I’m ready to go out and see.’ And we will make some plans.”

It was not until five weeks later, after Perez had inquired twice about preapproval in emails, that Perez emailed a batch of listings.

Experts’ Opinions

Freiberg: There was evidence of differential treatment in the provision of service. Even though neither tester was pre-approved for financing, the agent was reluctant to provide service to the Asian tester and delayed sending listings for five weeks, while the same agent accepted the word of the white tester that he was qualified to purchase a home and provided listings and a tour within four days.

Schwemm: There was evidence of discrimination and inferior treatment of the Asian tester regarding the preapproval requirement. Plus, this difference in treatment continued, with many listings being provided to the white tester vs. none to the Asian tester.

Agent and Company Responses

The vice president of communications for Perez’s then-parent company, RE/MAX LLC, provided a statement covering three tests of the firm’s agents, including Perez:

“We have spoken with the franchise owners whose agents were included in the inquiry and are confident that they have taken this matter seriously and are committed to following the law and promoting levels of honesty, inclusivity and professionalism in real estate.”

The spokeswoman, Kerry McGovern, declined to provide further information.

Representing both Perez and the Douglas Elliman company, where Perez is now an agent, an attorney with the Kasowitz Benson Torres LLP law firm watched the video recordings of the agent’s meetings with testers and reviewed listings maps.

Firm partner Jessica Rosenberg said Perez dealt more readily with the white tester because he said that he consulted a friend currently working for a mortgage company in Seattle about how much he could afford to spend, while the Asian tester had talked with a retired friend who had worked with a mortgage lender.

She wrote, “This point is critical – the white tester stated that he had had a conversation with a current mortgage lender.”

Rosenberg also asserted that Helling had “refused, despite Ms. Perez’s insistence, to meet with Ms. Perez’s preferred lender,” signaling that Helling was progressing with the process himself. In fact, the preferred lender participated in more than 15 percent of Perez’s meeting with Helling.

Watch videos of the test
TEST 32

Agent directs both testers away from Huntington, calls it a ‘mixed neighborhood’

When white and Asian testers consulted Raj Sanghvi of Century 21 about finding $500,000 houses within a half hour of Northport, Sanghvi cautioned only the white tester about purchasing in Huntington.

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“But you don’t want to go there. It’s a mixed neighborhood,” Sanghvi said, adding, “You have white, you have black, you have Latinos, you have Indians, you have Chinese, you have Koreans; everything.”

“It’s a mini, mini United Nations,” he continued.

Sanghvi suggested no Huntington houses to either tester.

Experts’ Opinions

Freiberg: Statements made by the agent to the white tester effectively steer buyers based on race. When referring to racially diverse Huntington, the agent told the white tester, “You don’t want to go there, it’s a mixed neighborhood.” The agent mentions that white, Black, Indian, Chinese live in Huntington and that it is a “mini United Nations.” The agent does not make this comment to the Asian tester. This is exactly the type of comment that agents should not make because it indicates a limitation or preference based on race.

Schwemm: There is evidence of steering, in the form of differential treatment. The agent commented on Huntington’s demographics only to the white tester, depriving the Asian tester of information that the agent apparently viewed as useful for someone choosing where to live.

Agent and Company Responses

Sanghvi and Michael Miedler, president and CEO of Century 21 Real Estate LLC, did not respond to requests for comment sent by letter, email and telephone.

Watch videos of the test
TEST 106

Agent disparages minority communities when speaking with both testers

When white and Asian testers sought the help of Joy Tuxson of RE/MAX in finding $500,000 houses within 30 minutes of Bethpage, she offered only the white buyer her opinions on crime in an overwhelmingly minority community.

Read more Read less

“I’m not going to send you anything in Wyandanch unless you don’t want to start your car to buy your crack, unless you just want to walk up the street,” Tuxson said.

The agent also spoke negatively to both testers about the predominantly minority Amityville school district. Speaking to the Asian tester, for example, she said that she had told a family member, “Do you really want your future children going to Amityville school districts?”

Experts’ Opinions

Freiberg: This is an example where both testers received listings in similar areas, but one or more statements made by the agent were discriminatory or involved possible steering away from predominantly minority communities and school districts.

Schwemm: The agent shared derogatory opinions about crime in the minority community of Wyandanch only with the white tester. Whether she was wrongly stereotyping or not, she provided greater information to the white tester than to the Asian.

The agent’s comments about Wyandanch and Amityville schools suggest that these towns could sue for the agent’s steering whites and Asians away from them – but it would be advisable to do additional testing by black and/or Hispanic testers to see if this agent makes similar comments to these minorities.”

Agent and Company Responses

Tuxson did not respond to requests for comment sent by letter, email and telephone. Kerry McGovern, RE/MAX vice president of communications, wrote in an email, “We have spoken with the franchise owners whose agents were included in the inquiry and are confident that they have taken this matter seriously and are committed to following the law and promoting levels of honesty, inclusivity and professionalism in real estate.”

Watch videos of the test

Correction: Mimi Hu’s son attends Saddle Rock Elementary School. The school’s name was incorrect in a previous version of this story.


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