Zillow’s mission to support fair housing 

April kicks off a new year of work to improve housing access and equity

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If you want to build wealth in the U.S. — enough to pass down to your kids, and their kids, too — owning a home is critical; homeownership is one of the primary drivers of wealth in the U.S. But a legacy of racism in the housing industry has led to a persistent and staggering $3 trillion wealth gap between white and Black populations, almost half of which ($1.2 trillion) is attributed to housing disparities. 

April is Fair Housing Month, a time to mark the passage of the Fair Housing Act of 1968, which was the first real progress against outlawing housing discrimination in the U.S.. That action was a start, but it wasn’t enough, and the effects of decades of unjust housing practices are still widely prevalent today. Exclusionary housing policies and practices, plus a dwindling supply of housing and a variety of other factors, have prevented aspiring BIPOC homeowners from purchasing homes at the same rate as their white counterparts: While 74.5% of white households own their homes, only 46% of Black and 49% of Hispanic households own theirs, with more than half of the top 50 metros showing a gap of 30 percentage points or more. 

The combination of redlining, racial covenants and other historical discriminatory measures means that today, many BIPOC consumers face obstacles, including financial barriers and access to credit, that lock them out of homeownership. In 2022, Black mortgage applicants were denied 84% more often than white borrowers. And as of January 2023, the typical U.S. home owned by a white household is worth 21.2% more than that of a Black household. 

A commitment to advocacy

At Zillow, we work year-round on our mission to help bring about meaningful change in the U.S. real estate industry and make home a reality for more people. We use the power of our platform and position as a leader in our industry to advocate for policies designed to help historically redlined communities achieve homeownership. Last year, Zillow worked with the Washington state delegation to pass a new law that would provide down payment assistance to the families of victims of redlining. Our advocacy work continues, with ongoing efforts in Oregon, Ohio and nationally, to support down payment assistance programs. 

One of the major reasons both Black and Hispanic borrowers are denied a mortgage is insufficient credit, according to 2023 data. That’s why Zillow is advocating for policies that would build credit histories for aspiring homeowners by permitting property owners and utility and telecom providers to report payments data to credit reporting agencies. This would allow consumers with an established track record of paying their bills on time the opportunity to develop a positive credit history.

How Zillow technology can help 

The growing prevalence of generative AI tools brings both exciting possibilities and risk to the real estate industry: Out of the box, the large language models (LLMs) behind many AI solutions do not consider fair housing requirements in conversations with users, and when deployed, can perpetuate housing bias. A technical solution is needed to uphold fairness and encourage unbiased behavior among its users. 

To that end, Zillow has built the LLM Fair Housing Classifier, which will be released under an open source license this spring. The purpose of the classifier is to prioritize fairness as we advance our commitment to innovation with generative AI technology. The classifier safeguards customers when asking important real estate questions, helping them to receive answers that are responsible and equitable, based on fair housing laws and principles. 

In addition to advancements in AI, we released a suite of innovative fair housing rental solutions in 2023. With high home prices and limited inventory, many Americans choose to rent instead of buy, yet discrimination remains a factor in the rental market as well. Black, Latinx and Asian/Pacific Islander renters report paying application fees that are 43% higher than those paid by white renters, and 38% of Black and Latinx renters report submitting five or more applications, compared to 21% of white renters.

In 2023, we built a number of new products to improve access and affordability for renters:

  • Rent reporting allows renters who pay their rent on Zillow to have their on-time payments reported to a major national credit bureau in order to build credit. 
  • Cost of Renting Summary helps renters gauge affordability by highlighting certain one-time costs, such as application fees and security deposits, as well as recurring costs, such as parking.
  • Room for Rent brings more affordable rentals online by allowing individual rooms in units or homes to be listed on Zillow.

These products add to our existing suite of rental solutions, which includes: 

  • Universal rental application, which allows renters to apply to an unlimited number of participating rentals for 30 days for one flat fee. 
  • Local legal protections, which displays information about legal housing protections based on gender identity and sexual orientation, as well as source of income
  • Housing choice voucher tool, which displays information and resources for eligible rental listings to help low-income renters search and find an affordable rental more efficiently.

For prospective home buyers, we have created a down payment assistance tool, which provides information on down payment assistance grants and loans. 

Working together to make community-wide change 

To help achieve fairness in housing access, Zillow prioritizes partnerships with organizations that make change happen on a local level. Since 2019, we have partnered with Housing Connector to match more than 6,000 people in need of a home to affordable vacant units in Seattle, Denver, Dallas and Portland. 

Housing Connector provides financial and tenant support to property owners and landlords, who in return adjust or waive criteria (such as credit and rental history) for potential renters, making units accessible that were previously out of reach. The Zillow Rentals® platform hosts the Housing Connector search platform, where property partners can upload available units, and local nonprofit service providers and their clients can find vacant inventory in real time.

Turning on the lights for all

Zillow is committed to driving meaningful change to make home a reality for more people. We know that the lasting effects of redlining have significantly impacted the racial homeownership gap, and we continue our work to advocate for policies, and leverage the power of technology and innovation to help make housing more affordable, fair and accessible for all. 

Explore more:

Watch this excellent short documentary, “Segregated by Design,” to learn about the history of racism in the U.S. housing market.

Read about fair housing protections for renters.

Visit Zillow Research’s Racial Discrimination in Housing dashboard.