A conservative legal group has filed a lawsuit challenging Oregon’s groundbreaking law that bans real estate “love letters” written by prospective homebuyers, contending the statute violates the First Amendment’s free speech clause.
In the suit, filed in federal court on behalf of Bend, Oregon, firm Total Real Estate Group, the Pacific Legal Foundation argued the ban on the letters also harms real estate agents’ ability to match clients with appropriate homes.
Authors of such letters describe why they would be the best owners for the house, in hopes of getting a leg up on competitors.
Oregon this year became the first state to pass a law against the letters, because information contained in them might be used to unlawfully discriminate against certain buyers and violate the Fair Housing Act. No other state has followed suit, but several discourage the practice. And real estate trade groups in states such as California and Washington also have acknowledged the issue.
But the Pacific Legal Foundation said there was no evidence of discrimination as a result of the letters.
“When you are talking about restricting speech it has to be more than a [feeling] that something somehow somewhere might be happening,” said Daniel Ortner, attorney for Pacific Legal Foundation, said in a phone interview.
“This ban on love letters restricts useful, truthful and beneficial information from buyers to sellers,” Ortner said. “They tell that the buyer is going to live in the home, not flip it or turn it into an Airbnb [short term rental] and that they are really interested in the home. It allows buyers who can’t compete in financing to compete for a home they might have otherwise lost out on.”
The author of the law, Oregon state Rep. Mark Meek, a Democrat and a real estate broker himself, told Stateline last month that agents in Oregon approached him about concerns that the letters—which often reveal family status, children, pets, religion and possibly hint at race—might be a problem. But he said he did not know of any related fair housing cases.
He said the letters can contain words “that would skirt on the border of breaking fair housing laws.” One example, he said, would be a reference to the desirability of having a church nearby, suggesting the potential buyers are Christian.
Prior to the Oregon law, he said, agents had a professional responsibility to pass along any communication from the prospective buyer to the seller. Now, a buyer can try to get the letter to the seller directly, but not through the agent. The suit asks the court for a preliminary injunction to stop implementation of the law, which is scheduled to take effect in January.