It is the goal of all good landlords to practice their business lawfully, to be ethical. Even landlords with the best intentions may accidentally run into situations and make mistakes. Marketing and screening for tenants can be one of the trickiest parts of owing rental properties. During this process it can be easy to ask questions we shouldn’t or make remarks that can form the basis of a fair housing claim.
In today’s blog, we’ll take a look at common mistakes landlords can and do make. I will use examples I’ve seen ourselves as property managers, and others that have been published. First let’s talk about marketing. Landlord has a nice 2-bedroom home for rent, but it’s on a pretty busy street. She worries that someone with small children could move in, and their kids would not be safe. She figures it’s a small house, so she’ll advertise it this way: Quaint little home perfect for students or young couples without kids. I saw this on Craigslist. I called the owner and gave her a crash course on Fair Housing. Her intentions were so genuine. She quickly fixed the advertisement. The prospective resident can drive by the home and see how busy the road is and determine if the home still meets their needs. The property owner changed her Craigslist title to say: Quaint 2-bedroom home with hardwood floors throughout, washer and dryer, dishwasher and one stall garage. In this case, fair housing did not get have to get involved. Be aware of discriminatory advertising language.
However, other landlords aren’t so lucky. Sourced from a blog written by All Property Management on 2/13/16 one Minnesota landlord was penalized $16,000 for violating fair housing. The blog states that a woman diagnosed with bipolar disorder attempted to rent a home with her partner. After being approved, the landlord became aware of her mental health issue. She called the prospective renter and asked her if she wanted to disclose any issues she has. The tenant told her landlord that she is bipolar. The landlord asked for details, and the renter told her it was none of her business. The landlord decided not to rent the house to this renter. HUD Prosecutors deemed the inquiry into the mental health diagnosis to be a violation of 42 U.S.C. Section 361 (g)(2)(A). The civil penalty was $16,000, in addition to damages (All Property Management).
In both cases, these landlords were breaking fair housing/HUD anti-discrimination laws. Their intentions may or may not have been good. It truly is astounding how difficult it can be to keep up with these laws. They change all the time. They differ between states and even between cities. Some cities protect classes like weight, height, income source and more. You have to know your city, and fair housing laws. Fortunately, there are professionals that do this, every single day. Professional property managers have the tools and knowledge to market and screen for your residents, even if you want to self-manage. Hiring a Grand Rapids property management company to fill a vacancy can go a long way for protecting your investment and keeping you out of trouble with the law.
