Fair or Unfair Housing?
In the matter of fair housing, the difference between “fair” and “unfair” housing can be a matter of perception. If your words, actions, or attitude cause a prospect, applicant, or tenant to question whether he is receiving different or unequal treatment from that accorded to another individual you may find yourself defending against a charge of housing discrimination. If the prospect’s complaint is found to be valid, you as a landlord that violated fair housing laws, will incur costly fines and other penalties to remedy that complaint.
In review, the federal Fair Housing Act covers most housing. In some circumstances the Act exempts owner-occupied buildings with no more than four units, single-family housing sold or rented without the use of a broker, and housing operated by organizations and private clubs that limit occupancy to members. However, great care must be taken when utilizing such exemptions, including determining whether or not the same exemption is provided under state and local law.
The Fair Housing Act as amended prohibits discriminatory actions in the sale and rental of housing based on the protected classes of race, color, national origin, religion, sex, familial status or handicap. Prohibited actions are:
- Refusal to rent or sell housing,
- Refusal to negotiate for housing,
- Making housing unavailable,
- Denying a dwelling,
- Setting different terms, conditions or privileges for sale or rental of a dwelling
- Providing different housing services or facilities,
- Falsely denying that housing is available for inspection, sale, or rental,
- Persuading (for profit) owners to sell or rent (blockbusting), or
- Denying anyone access to or membership in a facility or service (such as a multiple listing service) related to the sale or rental of housing.
In rental housing operations this means the landlord is not only unfair but illegal if he sets his rental policies to exclude prospects, provides different or false information about vacancies, limits use of rental facilities or amenities, engages in activities that steer prospects toward certain rental units or locations, or sets different lease terms, lease clauses or house rules for different prospects, applicants, or tenants.
Even trying to be fair (by saying or doing something that you consider beneficial – i.e. giving someone a break because you perceive they’re down on their luck) can get you into trouble. By trying to be fair to one, you become unfair to others. Perhaps the better course of action is not to try to be fair but to be fair.
State and local fair housing laws can be more restrictive or grant more rights (but not less) than federal law. You must understand all laws regarding fair housing and protected classes. It’s a good idea to further your understanding by networking with other landlords, consulting with a local landlord tenant law attorney, or taking continuing education classes in real estate and property management. You can know the law but knowing how the law is applied (by reviewing case studies) is a better way to help protect yourself against claims of housing discrimination.
Many violations of fair housing rights are due to ignorance of the law, failing to understand the laws, or misinterpreting the application of the law. However, knowingly or unknowingly, be it intentional disregard or well-meaning suggestions, if what you say or do is discriminatory, you have broken the law. Fair housing compliance is not optional or selective – it is mandated by federal, state, and local laws.
Our best advice for landlords is to remember that every aspect of rental operations is governed by fair housing laws. Because fair housing is such an important issue, the government and fair housing agencies employ testers to call or visit rental properties as prospective applicants to determine if a landlord or property manager is complying with fair housing laws.
Testers are most commonly employed when there is probable cause to believe that an owner or manager has engaged in practices that may violate federal fair housing laws. The courts have repeatedly upheld the use of testers as a valid enforcement mechanism when agencies use “testing” under the appropriate guidelines. If you treat all prospects as testers and your rental policies are non-discriminatory, you or your employees will not have to try to be fair housing compliant.
Fair Housing and Advertising
Understanding federal, state and local fair housing laws is also important for advertising and marketing your vacancy. While you may be exempt from federal fair housing provisions (see above for fair housing exemptions) you are not exempt from provisions of the Act that bans discriminatory advertising.
You want to market your vacancy to a diverse group of prospects to attract as many applicants as you can in order to minimize the length of vacancy. There are however specific advertising guidelines to follow for fair housing compliance. The language you use and those words in context can influence prospects positively or negatively. You should use words that describe the attributes of the property, not the people that could live there. Caution should also be used in the description of the property amenities to be sure that exaggeration (puffing) does not occur. Any advertising plan that indicates a preference or limitation or that discriminates against protected classes violates the Fair Housing Act.
In all advertising or promotional materials and your statement of rental policies or other written formal communication with prospects, applicants, and tenants, include the statement that you/your company does not discriminate on the basis of race, color, national origin, religion, sex, familial status, or disability. Include the fair housing logo as appropriate. While you cannot eliminate all risk or protect against all claims of discrimination, use of such statements and the logo will help emphasize your commitment to fair housing.
There are many ways a prospect may contact you for more information or showing of the unit. Prospects may call, email, or use mobile devices to gather information about the location, rental amount, deposits, lease terms, or rental policies to determine suitability to their wants and needs. You should respond promptly to all requests for information. Using linguistics to profile a caller from his speech, grammar or writing is a violation of fair housing laws. You must focus on qualifying prospects to your business plan, not preselecting them according to personal preferences. If you deviate from your rental plan, you incur additional risk.
Fair Housing and Disabilities
Fair housing laws also afford additional protection in rental housing to individuals with a physical or mental disability. Disability includes hearing, mobility and visual impairments; chronic alcoholism; chronic mental illness; AIDS or AIDS Related Complex; and mental retardation that substantially limits one or more major life activities. Individuals with a record of such disability or are regarded as having such a disability are also protected under fair housing laws.
Under fair housing law, you may not refuse to let a disabled tenant make reasonable modifications to the dwelling or common use areas at his expense if necessary for him to use the housing. Where reasonable, you may permit changes only if the tenant agrees to restore the property to its original condition when he moves.
You may not refuse to make reasonable accommodations in rules, policies, practices, or services if necessary for the disabled person to use the housing. However, housing need not be made available to a person who is a direct threat to the health or safety of others or who currently uses illegal drugs.
Fair Housing and Familial Status
Unless a building or community qualifies as housing for older persons, it may not discriminate based on familial status. That is, it may not discriminate against families in which one or more children under age 18 live with a parent, a person who has legal custody of the child or children, or the designee of the parent or legal custodian who has written permission from the parent or custodian.
Familial status protection also applies to pregnant women and anyone securing legal custody of a child under 18.
Right to Choose
While the above regulations may seem to increase the burdens placed on landlords, in effect, they do not. Such laws do not eliminate the rights of the landlord to attract and select tenants based on valid business principles.
Landlords do not have to accept unqualified applicants, uncooperative applicants, or applicants who give false or misleading information. Landlords can reject and should reject those applicants who pose a direct threat to property and the welfare of others. Accepting applicants because of fear of reprisal if the landlord rejects their applications is discriminatory because of giving preferential treatment to some and not others.
Having a “reasonable person” standard for fair housing compliance – that is, exercising judgment and conduct that could be expected of an average individual – serves as an objective test to determine if a breach of duty has occurred. Such a standard does not exist independently of other circumstances which could affect an individual’s judgment.
The bottom line is that fair housing compliance should be the backbone of your rental operations plan, including advertising, marketing, applicant screening and selection, and tenant relations.
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