Avoiding Fair Housing Complaints and Violations

One of the costliest hits a landlord can take to their business is a fair housing complaint, even if the complaint is unsuccessful, and the price paid isn’t just a financial one. In addition to legal expenses, monetary damages, civil penalties, and legal compliance costs, a fair housing complaint can also cause considerable harm to a landlord or property management company’s reputation, and that takes time for a business to recover from.

In order to avoid fair housing violations, landlords and property managers much approach the issue the same way they approach the physical upkeep of their properties: proactively, and with a mind for prevention rather than reaction. In this article, we’ll be covering the federally protected classes under the Fair Housing Act, examples of housing discrimination, and the various ways you can keep your business above board and within the bounds of the law.

Protected Classes Under the Fair Housing Act

The U.S. Department of Housing and Urban Development (HUD) is very clear about who is protected under the Fair Housing Act, and the extent of that protection. When someone is “renting or buying a home, getting a mortgage, seeking housing assistance, or engaging in other housing-related activities,” there are certain legally protected characteristics with which that person might identify, and landlords are expected to honor those protections. Individual states and cities may have their own protections in place for additional classes (for example, Philadelphia has fifteen protected classes), but federal law protects only the following seven:

• Race
• Color
• National Origin
• Religion
• Sex (including gender identity and sexual orientation)
• Familial Status
• Disability

From tenant screening to eviction, the Fair Housing Act provides federal protection against discrimination based on these protected classes.

Examples of Housing Discrimination

According to the National Fair Housing Alliance’s 2022 Fair Housing Trends Report, 2021 saw a significant increase in housing discrimination complaints, and the annual total was the highest in 25 years. Disability was far and away the protected class most cited in complaints that year, accounting for 50 percent or more of cases reported by the NFHA, HUD, Fair Housing Assistance Programs, and the Department of Justice, and so it is especially important to educate yourself on the protections guaranteed to disabled persons by the Fair Housing Act (we’ll get into reasonable accommodations in a bit).

We mentioned that states and cities can provide additional protections that aren’t federally recognized, and those should be given equal consideration when crafting protocols and processes for your property management business. The 2022 Trends Report also notes an uptick in fair housing complaints regarding potential state/city-protected classes such as source of income, criminal background, and age. Keep up to date with your state and local laws and ordinances, which can change from year to year, and revise your protocols accordingly.

As for the specific ways you can end up with a fair housing complaint on your hands, there are many of them, and HUD provides a number of examples on its website. We aren’t going to provide an exhaustive list here, but we will outline some of the pitfalls to look out for. Under the Fair Housing Act, it is against the law to take any of the following actions in light of the seven federally protected classes listed earlier in this article:

• Refuse to rent or negotiate housing
• Set different terms, conditions or privileges for sale or rental of a dwelling
• Falsely deny that housing is available for inspection, sale or rental
• Publish a notice or advertisement that indicates a preference or limitation
• Impose different sales prices or rental charges
• Use different qualification criteria or applications
• Evict a tenant or a tenant’s guest
• Fail or delay performance of maintenance or repairs
• Discourage the purchase or rental of a dwelling
• Assign a person to a particular building or neighborhood

Again, these are just a few examples of housing discrimination. Study up on your relevant state and local laws, and consult HUD’s website to make sure your practices are in line with the law. Failing to do so could cost you a pretty penny.

Standardized Tenant Screening Criteria

You may have noticed that more than half of the fair housing violations we just listed relate to the period of time before an applicant even signs a lease with you. You should be cautious during this phase, especially in regards to tenant screening, a process that can trip up even the most well-meaning landlord.

One way to ensure that your tenant screening process doesn’t trigger a fair housing violation is to make sure that none of your protocols or documentation contain any reference to or consideration of the aforementioned federally protected classes (as well as those protected under local and state laws). Equally important is consistency: process every applicant the exact same way, every time.

A particularly important aspect of tenant screening (and this extends to the rest of your property management business) is fastidious record-keeping. Encourage your employees and tenants to always communicate with one another in writing, with a preference for email so that the communication is timestamped. Maintain a well-organized and easily searchable archive of all rental applications, even (especially) those that you decline.

Other documents you should make a habit of hanging onto include screening results, lease agreements, and maintenance requests. Having such files on hand and readily available in the event that someone does lodge a fair housing complaint could be the difference between a painless resolution and a costly, drawn-out affair.

Protections Guaranteed to Disabled Persons by the Fair Housing Act

The Fair Housing Act provides robust protections for people with disabilities, and landlords should exercise care in all interactions and dealings with applicants or tenants with disabilities, especially when it comes to reasonable accommodations. According to HUD, a reasonable accommodation is “a change, exception, or adjustment to a rule, policy, practice, or service that may be necessary for a person with disabilities to have an equal opportunity to use and enjoy a dwelling, including public and common use spaces, or to fulfill their program obligations.” Examples of commonly requested reasonable accommodations include:

• Permission to transfer to a ground-floor unit
• Permission to submit a housing application via a different means
• An accessible parking space for a person with a mobility impairment
• Authorization for an assistance animal in a “no pets” building for a person who is blind, deaf, has seizures, or has a mental disability (for more on this, check out our in-depth guide to pets and assistance animals, and how to navigate reasonable accommodations in regard to them)

It may seem counterintuitive, but as a landlord, the onus is on you to determine and demonstrate whether a requested accommodation is “reasonable.” The Fair Housing Act requires a housing provider to allow a reasonable accommodation in situations that meet all the following conditions:

• A request was made to the housing provider by or for a person with a disability
• The request was supported by reliable disability-related information, if the disability and disability-related need were not apparent and the housing provider requested such information, and
• The housing provider has not demonstrated that:
• Granting the request doesn’t impose an undue financial and administrative burden on their business
• Granting the request wouldn’t fundamentally alter the essential nature of their operations.
• The requested accommodation in question doesn’t pose a direct threat to the health or safety of others.
• Granting the request would not result in significant physical damage to their property.

Reasonable accommodations can quickly become complicated affairs, so don’t hesitate to consult a legal expert to make sure all your ducks are in a row.

Maintenance Requests: Emergencies vs. First-Come, First-Serve

In general, it is a good idea to institute a first-come, first-serve model for maintenance requests. Doing so provides a fair framework for the process, and protects you from fair housing complaints. But there are certain situations in which strictly adhering to that model can actually trigger a fair housing violation.

Maintenance emergencies include things like gas leaks, exposed electrical wires, major roof leaks, or lack of electricity/water. Generally speaking, maintenance staff should be equipped to respond to these issues within a 24-hour period. Even if a maintenance request doesn’t necessarily present a potential health- or life-threatening situation, it may still result in serious structural damage to your property, and in such cases you should still consider it an emergency and have protocols in place to deal with it accordingly, if only for your sake.

It’s also important to have established procedures that take into account when the emergency maintenance request is made. A request made at 3 p.m. on a Tuesday is probably going to need to be handled differently than a request made after midnight on a Saturday morning. Make sure an emergency after-hours phone number is distributed to all tenants, and have clear and concise steps that you and your employees should follow in the event that an after-hours request is made.

Failure to quickly and efficiently tend to an emergency can not only result in a costly fair housing complaint—it can also lead to serious damage to your investment. Utilizing coordination services like Lula can help you avoid some of those delays.

Unfortunately, there exist more scenarios that can saddle your business with a fair housing violation than we can fit into one article, so do your due diligence: stay abreast of federal, state, and local laws, and make sure you have a thorough understanding of the Fair Housing Act. This is the firm legal foundation of any successful property management business.