The housing market is one of the most competitive we have ever seen—at least since the National Association of Realtors started keeping records in the late 1960s. Buyers are literally doing anything they can to give them the advantage when submitting offers to purchase a home.
Historically, a common tactic deployed by the buyer to connect with a seller is the heartfelt "love letter." It's a seemingly innocuous note expressing their love for the property, giving a bit of background on themselves and vision for the home in an attempt to strike a positive emotional connection with the seller. It has become such a commonplace approach, buyers can even go online to sites like Etsy and purchase ready-made templates, complete with the earnest verbiage and places to upload photos and even go so far as to fill in brief descriptions of each family member.
- Adobe Stock
This is all seemingly harmless, right? According to the National Association of Realtors, these letters are raising fair housing concerns and creating potential liabilities for the seller and the real estate professionals who are delivering and receiving these letters. NAR has gone so far as to create guidelines for its members stating that members should not encourage, draft, read, deliver or accept letters from buyers any longer.
Why is this? According to the federal Fair Housing Act, it is illegal to discriminate in the sale of housing based on race, color, national origin, religion, sex, familial status and disability. The State of Oregon goes a step further and includes marital status, source of income, sexual orientation including gender identity and domestic violence victims. These letters are full of these kinds of details. For example, the letter describing the young family who loves the property because of the swing set in the yard, who are looking forward to decorating the beautiful fireplace mantle with Christmas stockings with the kids and the bedroom with the en-suite bath on the main level is perfect for their father who has difficulty with stairs. That simple and seemingly innocent description provides information about family status, religion and feasibly disability. Couple that with a family photo and race becomes revealed as well. All of the aforementioned are protected classes and create an opening for discriminatory bias, be it unconscious or explicit bias; thereby creating liability and quite possibly legal issues.
Real estate contracts are benign and strictly stick within the confines of trade and consideration. Consideration is the price one is willing to pay and trade means the terms under which consideration will be executed. The reason for this is to remove the possibility of fair housing violations.
The elimination of the love letter removes the possibility for discrimination (intentional or unintentional), and the perception or claim of discrimination from a potential buyer. The National Association of Realtors' goal is to protect its members and members' clients from legal liability and ultimately protect the health and success of the real estate industry. Thus, the member guidelines regarding "love letters" from buyers were adopted in an effort to prevent potential fair housing violations altogether. A practice that has become commonplace will soon be a thing of the past. Buyers, please know that when one's real estate professional advises against the letter and refuses to deliver the letter, it isn't because they don't want to give any advantage, it is because they are working to protect everyone involved in the sales process from liabilities and potential legal ramifications. It is best for buyers to focus on price and terms to give themselves the highest advantage in such a competitive market.