The Oregon Legislature violated free speech rights when banned it Realtors from passing so-called “love letters” from potential homebuyers to sellers, a federal lawsuit filed by a Bend real estate group contends.
The suit, filed in the U.S. District Court in Portland late last week, asks the court to block the new law from taking effect in January. It passed with broad bipartisan support in the state House, while most Republicans in the Senate opposed it.
Rep. Mark Meek, the Gladstone Democrat who sponsored the measure, and other supporters described it as a way to avoid perpetuating racial segregation. In hot housing markets like Portland and Bend, potential homebuyers can sometimes gain an advantage over competing bidders by crafting heartfelt letters to sellers explaining why they want the home.
But Meek, who owns a Portland real estate firm, sees those letters creating the risk that sellers will discriminate against buyers. He said he recently had a client accept an offer from a buyer who submitted a love letter and family photo, despite higher offers, because his client liked the idea of the buyers’ children going to the school down the road.
“While this practice may seem like a harmless way to get an advantage in a competitive market, it actually perpetuates systemic issues of bias in real estate transactions and creates fair housing risk for real estate professionals,” he told a state Senate committee in May. “It too often results in sellers making decisions based on the perception of who will ‘fit in’ to their neighborhood better.”
The federal Fair Housing Act prohibits refusing to rent or sell based on protected characteristics including race, sex, religion and family status. Neither Meek nor the National Association of Realtors are aware of any complaints under the Fair Housing Act caused by love letters, according to the complaint.
In its lawsuit filed against Oregon Real Estate Commissioner Steve Strode and Attorney General Ellen Rosenblum, Bend-based Total Real Estate Group argues that the ban violates First Amendment rights and will in fact make it harder to police potential housing discrimination. The law doesn’t prohibit buyers from contacting sellers directly to send love letters, nor does it have any way to prevent buyers, sellers or their brokers from talking on the phone.
Real estate agents must take courses on housing discrimination laws every two years to keep their licenses current, and the lawsuit argues that brokers are thus able to advise clients to remove any information from their letters that could “raise the specter of discrimination.”
The lawsuit notes that sellers often have an emotional connection to the homes they put on the market, and letters from buyers can reassure them that the home will still be cared for after they move and won’t be bought by a distant investment company. Love letters can also serve as a reassurance that a buyer is serious about closing a deal, according to the complaint.
“This is not simply speech about buying a widget or article of clothing from Walmart,” the complaint said. “The home has long held a special place in our culture and our law.”
Oregon is so far the only state to bar Realtors from passing love letters from buyers to sellers.
Last October, the National Association of Realtors advised its members to refrain from helping clients draft or deliver love letters to protect themselves from potential liability under housing laws.
A spokeswoman for the Oregon Real Estate Commission said the department had no comment on pending litigation. The Oregon Attorney General’s office did not respond Wednesday to inquiries.
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