Friday, February 14, 2014

What Property Managers Must Know About Fair Housing Laws, But Are Afraid To Ask

Fair housing laws were implemented in the U.S. during the Lyndon Johnson Administration of the 1960s to help prevent discrimination towards minority and underrepresented groups in housing or renting.  Some fifty years later we are still faced with it on a daily basis.  According to recent data there were close to 30,000 housing discrimination complaints filed in the U.S. in 2012, which is an increase of nearly 5% from 2011.  As a property manager or a property management company it is paramount to understand these basic fundamental laws to avoid any violation and potential liability for you and the property owner.

Advertising Must Comply with Fair Housing
The following language should be communicated on all advertisements, websites, marketing materials, and communications:

“ABC Property Management and our clients do not discriminate on the basis of race, color, religion, national origin, sex, disability or familial status.”

By displaying this language you are communicating a public acknowledgement of the Fair Housing laws and the concomitant           restrictions.  Property managers need to be mindful not to use language which although is seemingly innocuous actually discriminates against its perceived audience.  Some examples of this are phrases like, “great for a young couple,” “family-oriented neighborhood,” or “perfect for single female.”   Words which appear harmless like “safe,” and “exclusive,” also imply that the property is not available for certain groups based on stereotypes.  A prudent practice for property managers and property management companies would be to describe the neighborhood, its location, and attributes of the surrounding areas instead of being exclusionary towards individuals.

Screening Policies Requires Precision in Communication
A written policy for minimal tenant standards is critical such that a bar is set and cannot be overlooked in qualifying tenants.  The exact items to have in a written screening policy include employment history, present income, credit worthiness, criminal background, eviction history and any other red-flags on a screening report.  This information should be communicated to the prospective tenant immediately and be front and center in a written policy such that a tenant that is denied for meritorious reasons will not be able to argue discrimination.  These standards must be clear, concise, and unambiguously communicated to the potential tenants.

House Rules Must be Consistent
All rules in an apartment house or complex must be compliant with Fair Housing laws and must pertain to everyone, not just a few.  Rules must not single out children, unless the rule is designed as a life safety issue such as children being supervised at a community pool.  Any violations of the rules must be documented with the date, time, specific violation, violator described, and remedy undertook by the property manager.  Property managers must keep accurate and complete records of these instances, circumstances and conduct.

Eviction Process has to be Detailed
Fair Housing laws allow for tenants to be evicted for meritorious reasons such as non-payment of rent.  There are other acts and conduct that can result in a tenant being evicted; however, these standards must be detailed, consistent, and non-discriminatory.  A property manager must keep detailed records of each and every conversation, act, confrontation, or circumstance which leads to an eviction.  The documents which should be included in a tenant’s file in chronology include but are not limited to:
1)   Warning letters and/or eviction notices
2)   Written complaints by neighbors to city police
3)   Writing logs maintained by property manager
4)   Police records
5)   Photographs
A property manager’s website or tenant packet must include with specificity a list of conduct which a tenant may not engage in.  Eviction is the ultimate owner remedy for removal of a bad tenant, however, the property manager’s goal should be to maintain a personal working relationship with the tenant and resolve any issues that could result in an eviction.

Employee Training is Critical
For those property managers who employ staff to deal with tenants it is imperative that the employees receive Fair Housing education and training.  Each employee should be required to read and be familiar with Fair Housing laws and should be required to maintain a Fair Housing manual.  They should also be required to sign a commitment to comply with Fair Housing laws and non-discriminatory practices to help prevent any situation from occurring.  This is for everyone’s protection including the tenants, the employees, the property manager and the owner.

Real Estate Attorneys Can Help Property Owners with Fair Housing Laws
Property management companies who have a real estate attorney on staff can help owners with their Fair Housing questions.  A real estate attorney familiar with Fair Housing laws has the expertise, training and procedural knowledge to help keep owners on the right side of the law.