The starting point in any new tenant search is advertising for a tenant. Over the years, a complex set of advertising requirements, restrictions and prohibitions have emerged to ensure fair and equal access for all to housing.
Fair housing laws were enacted at a federal and state level to ensure everyone has equal access to the housing of their choice. Fair housing laws apply to public and private housing providers (landlords), but also to real estate transaction providers like real estate brokers, mortgage lenders, homeowner associations, and most anyone involved in a real estate sale or leasing transaction.
As a real estate investor, it is critical that you comply with Fair Housing laws when you rent your property as there are strict and severe penalties for non-compliance.
Federal Fair Housing Act
The Fair Housing Act is a federal civil rights law enforced by the Department of Housing and Urban Development (HUD) that prohibits housing discrimination based on race, color, national origin, religion, sex (including gender identity and sexual orientation), familial status, and disability.
You can download a copy of HUD’s Fair Housing Booklet for a more detailed review of federal fair housing laws..
Protected Classes
The Fair Housing Act specifically protects a number of classes in all housing-related activities:
- Race
- Color
- National Origin
- Religion
- Sex (includes gender identity and sexual orientation)
- Familial Status (includes families with children under 18, pregnant women, and those in the process of securing legal custody)
- Disability (physical or mental)
What Housing Does the Fair Housing Act Cover?
The Fair Housing Act covers most housing, including private market rentals, public housing, and real estate transactions.
Exemptions from the Fair Housing Act
There are narrow exemptions for homeowners and for-sale-by-owner sellers, but no exemptions for real estate investors. Exemptions from the Fair Housing Act are for:
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- Owner-occupied buildings with four or fewer units.
- Single-family homes sold or rented by a private owner without the use of a real estate broker.
- Housing operated by private clubs and religious organizations that limit occupancy to members.
Download the Fair Housing booklet right here and stay compliant with fair housing laws.
You must also comply with state and even local municipal fair housing laws.
In Colorado, housing is covered by the Colorado Fair Housing laws.