A broker telephones homeowners on one block and urges them to list now, warning that minority families are moving in and values on the street are about to drop. What illegal practice is this?
Correct Answer
A) Blockbusting
Blockbusting, sometimes called panic peddling, is inducing an owner to sell or rent by representing that people of a protected class are entering the neighborhood and that values or the quality of the area will decline. The violation is complete when the representation is made to induce the sale; no listing needs to be taken and the prediction need not come true. It is prohibited by Section 804(e) of the Fair Housing Act.
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Related Topics & Key Terms
Key Terms:
Related Concepts
License requirements are the mandatory qualifications—including pre-licensing education, examination, and background checks—that a person must satisfy before legally practicing real estate. These requirements are established and enforced by each state's real estate commission.
Market allocation is an illegal antitrust practice in which competing real estate brokerages agree to divide markets among themselves by geographic area, property type, or price range, thereby eliminating competition.
Price fixing is an illegal antitrust practice in which competing real estate brokerages agree to charge the same commission rates, fees, or other pricing for their services. It is a per se violation of the Sherman Antitrust Act.
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