Dive Brief:
- HUD is launching an investigation into the Washington State Housing Finance Commission over suspicions that its Covenant Homeownership Program is racially discriminatory toward White people and other groups, according to the agency.
- In a March 24 letter, Craig Trainor, assistant secretary for Fair Housing and Equal Opportunity at HUD, said that “the publicly available information about the commission’s program strongly suggests that unlawful discrimination is occurring and, therefore, warrants investigation.” In the letter, Trainor said he directed the Office of Special Investigations to probe the commission for Fair Housing Act violations.
- The goal of the Covenant Homeownership Program, passed by the Washington State Legislature in 2023, is to help remedy Washington’s history of housing discrimination through racially restrictive covenants and redlining. It serves certain first-time homebuyers who have a family history in the state before 1968, per the program website.
Dive Insight:
Nearly 80,000 racially restrictive covenants have been documented throughout Washington by the Racial Restrictive Covenants Project of the University of Washington and Eastern Washington University.
According to the program website, “Covenants were commonly used between the 1920’s and 1960’s throughout Washington state to restrict housing based on race, religion, and ethnicity. A typical covenant required the signer to agree they would never allow a non-white or non-Christian person to buy or live in their home.”
In March 2024, the National Fair Housing Alliance released the Covenant Homeownership Program Study, which established the framework for the Covenant Homeownership Program. It documents Washington state’s long history of housing discrimination, as well as how past discrimination continues to harm families and communities today.
The resulting program is open to first-time homebuyers who lived in Washington before April 1968, or who have a parent, grandparent or great-grandparent residing in the state before that date, per the program website. That person must be Black, Hispanic, Native American, Alaska Native, Native Hawaiian or other Pacific Islander, Korean or Asian Indian. Washington has other support programs open to low- and middle-income homebuyers without these restrictions.
Last year, the state passed a bill that increases the eligibility income limit and allows the forgiveness of Covenant DPA loans for some homebuyers. Multifamily Dive reached out to the Washington State Housing Finance Commission for comment but did not hear back by publication time.
However, Trainor said in the letter that publicly available information about the commission’s program strongly suggests that unlawful discrimination is occurring, and any discrimination based on race is “morally reprehensible, socially perverse, and destructive of America’s pluralistic polity. The Trump Administration will not tolerate it.”
“This government-sponsored housing experiment appears to dole out spoils based on race and ancestry—‘some racial groups [are] eligible and not others,’” the letter reads. “Washington residents of European, Japanese, Arab, and Jewish ancestry—no matter their income—appear to be ineligible for the program.”
Trainor cited comments from Judge Emil Bove in a March 6 case in the U.S. Court of Appeals for the Third Circuit. Writing on behalf of the three-judge panel, Bove said that any discrimination based on race is forbidden, and “this logic holds firm even where the rule at issue was established for a beneficial or laudable purpose.” The ruling will likely make it easier for White people to bring charges of reverse discrimination, Reuters reported.
In the letter, Trainor said Washington’s covenants predate the creation of the commission in 1983, and it does not appear that the agency issued or denied loans based on race before launching the Covenant Homeownership Program in 2024. Since the agency did not directly discriminate, it has no legal basis to justify trying to address the problem.
“As a general matter, ‘a governmental agency’s interest in remedying societal discrimination, that is, discrimination not traceable to its own actions, cannot be deemed sufficiently compelling to pass constitutional muster,’” Trainor’s letter reads.
This is just the latest move from HUD to investigate housing programs that aim to address the impacts of historic racial discrimination. In February, HUD launched a fair housing investigation into the developers of a master-planned community northeast of Dallas that has been marketed to Muslims, saying they may have engaged in religious and national origin discrimination.
The previous month, HUD announced an investigation into Minneapolis’ housing plans, practices and policies, saying the city “may be engaging in unlawful discrimination by prioritizing Minneapolis residents for housing based on race and national origin rather than need.”
In December 2025, the agency announced a probe into Boston’s housing practices, claiming that local officials tried to “smuggle” racial equity into the city’s operations and intended to implement discriminatory housing policies.
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