When you own a residential rental property, you may require a minimum set of standards for your tenants. This may include an above-average credit score, an adequate annual income, and other information that can prove that your prospective tenant/s will be able to pay their rent. What you should never include in your list of requirements, however, is criteria that suggest that you’re looking for a certain type of tenant. Every prospect must be treated fairly and given the equal opportunity to apply for your rental. To put it simply, you cannot discriminate. To ensure these equal facilities, you must follow the fair housing act – 1968.
Whether you are self-managing your rental or leaving it in the hands of a Florida property management Service provider, you must understand the act to avoid violating the law. If you don’t, you may find yourself in serious legal trouble.
What is the Fair Housing Act?
The Fair Housing Act was put in place in 1968 to protect tenants and homebuyers from discriminatory activities related to housing, such as buying a home, renting a home, and applying for a mortgage. It is based on the principle of granting equal opportunities to all persons, regardless of factors that are beyond their control, such as their sex, religion, race, disability, and so on.
What is the History of the Fair Housing Act?
Efforts to establish a law on housing started in the 1800s. During that time, landlords and realtors weren’t prohibited from refusing to rent or sell their properties to persons based on their race, nationality, or for other reasons. Many listings would explicitly state that only those who satisfied their criteria could apply.
Before the Act was signed into law, two other laws attempted to address discrimination: the Rumford Fair Housing Act of 1963 and the Civil Rights Act of 1964. It wasn’t until 1968 that the Fair Housing Act was signed into law shortly after the assassination of Martin Luther King Jr.
Who is Protected By the Fair Housing Act?
Under federal law, the act forbids discrimination against any person, regardless of their:
- National Origin
- Familial Status (e.g., households with children, pregnant tenants, etc.)
It is important to note that under state and local laws, additional protection may be granted towards renters and homebuyers who fall under other protected classes, such as:
- Criminal history
- Source of income (including those who receive rental assistance)
- Gender identity
- Military status
- Sexual orientation
- Marital status
Ask your property manager to make sure that you are following both federal and state laws on housing. You may also consult an attorney who specializes in real estate and housing.
What Actions are Prohibited Under the Fair Housing Act?
Discrimination occurs when a landlord, realtor, property manager, etc. treats an applicant unfairly based on the attributes mentioned above. Below are some examples of discriminatory activities that are frowned upon by the Act:
Advertising a Property
Try to avoid discrimination while advertising your property. Whether online, on billboards, or on any other kind of platform, you must be careful not to use statements and images that may be perceived as discriminatory. To ensure that your listing is compliant with the Act, as a rule of thumb, you should focus on what your property has to offer.
Examples of discriminatory actions in advertising include:
- Publishing any notice or advertisement that indicates the landlord’s preferences (e.g. age, sex, religion, etc.)
- Denying the rental property to a protected class
- Using photos with human models that portray a certain type of tenant (e.g. Caucasian, young professional, etc.)
Tenant Screening Process
The best way to avoid unintentional discrimination is to use a consistent screening process. This grants each prospective tenant an equal chance to apply for housing. If you don’t have a documented screening procedure in place, consider working with a Florida property management firm.
How you can avoid discrimination during the screening process:
- Ask the same set of questions to all applicants.
- Avoid making discriminatory comments — even if unintentionally — such as, “This home is ideal for families without physically challenged members.”
- Use the same rental application for every prospective tenant.
- When tenants ask questions, be sure to focus on the property and its amenities.
- Score each prospective tenant impartially.
- Offer applicants a valid reason for the denial of their application.
- Conduct background checks, credit checks, and other verification, but be sure to do this for all applicants. Consult with your property manager or attorney regarding state and local guidelines on obtaining information regarding their criminal history and sex offender registry.
Providing Equal Housing Opportunities
Steering is a term in real estate that refers to the act of deterring a prospective tenant from renting a property. Many believe they can get away with steering as it doesn’t outrightly deny a tenant from renting a property.
How you can ensure that every tenant receives equal housing opportunities:
- Allow prospective tenants to see the property or unit that they are interested in.
- If you have multiple vacancies in a multi-family property, offer all of them and let the prospective tenant choose.
- Do not assign a tenant to an undesirable location in the building based on their protected class.
- In properties such as condominiums, ensure that all tenants have access to the facilities and amenities (e.g. pool, gym, daycare center).
What Are the Penalties for Fair Housing Act Violations?
Landlords who violate the Act may face up to $100,000 in civil penalties, but that’s not all. You may be charged with additional penalties, such as punitive damages, non-economic damages, compensatory damages, and more. The U.S. Department of Housing and Urban Development (HUD) may also file a charge against you, where you will have to defend yourself in court. What’s more, is that the HUD will keep this information available to the public, which means that your reputation as a landlord may be tarnished for good.
As you’ve probably realized by now, the Fair Housing Act is something that you must not take lightly. As a landlord, you must fully comprehend the laws that protect your tenants so that you can avoid winding up with a long-drawn-out lawsuit.
Ask any of the property managers at Luxury Property Care about anything related to the act. Our team would be happy to offer our professional advice on matters related to the anti-discrimination laws that govern residential rental properties in Florida.
Call us today at (561) 944 – 2992 or complete our contact form today.