Fair Housing

Fair housing is a heavily tested topic. Agents must understand protected classes, illegal practices, and advertising rules.

Equal Opportunity in Housing

Fair housing laws prohibit discrimination in housing transactions. The federal Fair Housing Act covers most housing and applies to sales, rentals, advertising, and lending.

Federal Protected Classes

The federal protected classes are:

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

States may add protected classes such as age, marital status, or source of income. For the national exam, focus on the federal classes.

Prohibited Practices

Illegal practices include:

• Refusing to sell or rent based on protected status
• Steering buyers toward or away from certain neighborhoods
• Blockbusting or inducing panic selling
• Redlining or denying financing based on neighborhood
• Discriminatory advertising or selective availability

Table: Common Fair Housing Violations

HUD and Enforcement

The U.S. Department of Housing and Urban Development (HUD) enforces federal fair housing laws. Complaints can lead to investigations, penalties, and civil lawsuits.

Americans with Disabilities Act (ADA)

The ADA requires reasonable accommodations for persons with disabilities in public accommodations and certain housing situations. For housing, the Fair Housing Act also requires reasonable accommodations and reasonable modifications when necessary.

Advertising Rules

Advertising must be inclusive. Avoid language that expresses preference or limitation, such as:

• "No children" or "Adults only"
• "Christian neighborhood"
• "Ideal for young couples"

Use neutral phrases like "spacious two-bedroom" or "near public transportation."

Exam Traps

• Assuming fair housing applies only to rentals (it applies to sales too).
• Using coded language that implies discrimination.
• Forgetting familial status or disability as protected classes.

Summary

Fair housing requires equal opportunity in housing. Know protected classes, illegal practices, and advertising rules. When in doubt, use neutral and inclusive language.

Fair Housing Enforcement and Penalties

HUD investigates complaints and can refer cases for administrative hearings or federal court. Penalties can include fines, damages, and required training. Brokerages can be liable for their agents' actions if they fail to supervise or correct violations.

Test Tip: Intent Does Not Matter

Even if the agent does not intend to discriminate, statements or actions that show preference or limitation can still violate fair housing laws. The focus is on effect, not intent.

Exam Application Check

If a question asks whether good intentions protect an agent, the answer is no. Fair housing rules apply regardless of intent.

Exemptions and Limitations (General)

Some limited exemptions exist under federal law, but they are narrow and state rules may be stricter. For the national exam, the safest approach is to assume fair housing rules apply and avoid discriminatory practices.

Familial Status Examples

Families with children are protected. Examples of discrimination include:

• Refusing to rent to a couple because they have a newborn
• Steering families to only certain buildings
• Imposing higher deposits because of children

Advertising Do's and Don'ts

Do use property features and objective facts:

• "Two-bedroom, two-bath near transit"
• "Wheelchair accessible entrance"

Do not use words that imply preferences:

• "No children"
• "Christian home"
• "Perfect for singles"

Exam Application Check

If an ad implies a limitation based on a protected class, it violates fair housing rules.

Reasonable Accommodations vs. Modifications

• Reasonable accommodation - A change in rules or policies. Example: allowing a service animal in a no-pets building.
• Reasonable modification - A physical change to the property. Example: installing a ramp.

Housing providers must allow reasonable accommodations and modifications when necessary for a person with a disability.

Fair Housing Scenario

A landlord refuses to rent to a family with children because the unit is "too small for kids." This is discrimination based on familial status and is illegal under federal fair housing law.

Exam Application Check

If a question asks whether a statement is discriminatory, ask if it shows a preference or limitation based on a protected class. If yes, it violates fair housing rules.

Steering, Blockbusting, and Redlining

Steering - Guiding buyers toward or away from certain neighborhoods based on protected class. Illegal even if the buyer asks about demographics.

Blockbusting - Inducing owners to sell by suggesting that a protected class moving into the neighborhood will lower values.

Redlining - Denying or discouraging loans or insurance in certain areas based on race or other protected class factors.

These practices are explicitly prohibited and appear frequently on exams.

Disability and Accessibility

Under fair housing rules, owners must allow reasonable modifications at the tenant's expense, and reasonable accommodations in policies. For example, a tenant may install a grab bar at their own cost, and a landlord must allow a service animal even in a no-pets building.

Exam Application Check

If a question involves restricting families with children or refusing a service animal, it is a fair housing violation.