Avoiding discrimination is imperative when you own investment rental property. The Fair Housing Act regulates this and you could find yourself in legal trouble if you do not adhere to these regulations.
First, you must make sure that the property is available to be shown to all individuals who are interested in renting it. Generally, interested parties will call to inquire about the property before they actually see it. When you answer questions about the property you must make sure that you are providing the same information to everyone who calls. If you venture into offering different conditions, terms and/or information to different individuals who call to inquire about the property, you could be liable for discrimination. Basically, you need to make sure that you are covering all of the specifics of the property without necessarily trying to deter applicants away from the property based on any of the areas which are protected under the Fair Housing Act. Areas which need to be covered when applicants call include amenities of the property, property size, location, etc.
In addition, you need to make sure that your rental application is also designed with fair housing standards in mind. The best way to do this is to have an attorney review your rental application and then provide the same documents to all prospective renters. Also, make sure that the process is the same for everyone. Ultimately, when you deny or accept a rental application your decision should be based on valid requirements and not personal opinions.
Beyond the application, you will also need to give some thought to occupancy restrictions for your property. It is not uncommon for many people to restrict the number of people who are allowed to live in their rental unit. There can be many different justifications for occupancy restrictions and standards. When establishing occupancy restrictions and standards; however, you need to be certain that your standards are fair and do not effectively discriminate against families with children. This is one of the more common complaints filed as many prospective tenants feel as though an overly restrictive standard regarding maximum occupancy discriminates against them and their children.
Different laws regarding occupancy standards and restricts apply in different states. The key in most states is to ensure that you are using good reason and common sense. For example, if you have a 1,000 square foot two bedroom home, then it would obviously be excessive to have seven people in the home.
There are no prohibitions regarding restrictions on the number of people who are allowed to occupy a residence under the Federal Fair Housing Act. It is critical; however, that any restrictions which are adopted be reasonable and apply to all occupants. You must not discriminate on the basis of race, color, national origin, family status, gender, religion or handicap.
The most common standard adopted by most property managers is two people per bedroom. This standard is considered to be fair and reasonable by most. If; however, the residence in question is particularly large or it could easily accommodate more persons, it is important to keep in mind that such a policy could be challenged and a complaint filed so it is imperative to be sure that standards are flexible when the need calls for it based on available space within the dwelling.