The following questions involve important fair housing issues.
The REALTOR® and the rental property
The broker is thinking about buying a home in the Northwoods on a lake and anticipates renting it out for periods throughout the year. The broker is concerned about the liability if rented to people with small children. Can the broker stipulate no rental to families with children under the age of 6 because of the possible danger the lake would present if children can’t swim?
The Fair Housing Act applies to both the sale and rental of real estate. It applies to individuals as well as brokers providing real estate brokerage services. In addition, as a landlord or principal in the sale or rental of real property, REALTORS® agree to comply with the Code of Ethics, including Article 10, which provides that REALTORS® shall not be parties to discrimination. Under the Federal Fair Housing Act and Wisconsin fair housing law, familial status (families with children under the age of 18 living with parents or legal custodians; pregnant women and people securing custody of children under 18) is a protected class. A concern for safety cannot be a pretext for engaging in discrimination.
Well-intentioned steering
An apartment building has open stairways and there is a second floor unit. A family with young children is looking at it. It is somewhat of a safety hazard with the open stairways and a couple of balconies that are two stories up. Is it the broker’s place to tell them whether or not the apartment is safe for their children?
The broker must tread lightly because he wants to make sure he is not representing or implying that families with young children are not welcome to live on the second floor. That would be a discrimination complaint waiting to happen. It is against federal and Wisconsin fair housing law to limit the floors on which families and children may live. The broker may politely point out in a general manner, not specific to children, the safety hazards of an open stairway on the second floor.
It would be most prudent, however, to not mention it because the family may perceive adverse implications or innuendoes in even innocent statements and file a complaint. The agent’s well-intentioned concern could be characterized as a subtle form of steering. The agent decides on behalf of the buyer that should not rent the unit because of this hazard. Unless the agent points out the safety concern to all potential tenants, it is best to not mention it.
For more information, see the April 2007 Legal Update, “Avoiding Discrimination in Advertising and Racial Steering,” online at www.wra.org/LU0704.
The 70-pound lab
An offer has been written on a condominium unit where dogs over 15 pounds are not allowed. The offer is contingent upon written authorization from the condominium association for a “service dog” (a Labrador retriever weighing approximately 70 pounds) to accompany the buyers on the purchased premises and related common areas.
The buyers have no apparent disabilities. The listing agent is aware that there are emotional needs that may require a service animal. Would it be proper for the listing agent to request a letter from the buyers’ doctor for proof of disability and also proof of training for the service animal? If the buyers submit both, is the association legally bound to give the requested authorization? Or may they still deny the request?
The listing agent should advise the seller and/or the condominium association to contact their attorney to advise them on how to proceed and whether it is permissible and legal to deny the request.
Under federal law pertaining to reasonable accommodations, if the person with disabilities provides documentation that he or she has a physical or psychiatric disability that substantially limits a major life activity and that because of the person’s disability a companion animal is necessary to enable the person to equally enjoy the unit, the companion animal must be allowed. This requires some documentation of both the disability and the need for the accommodation. The buyers, however, need not disclose the details of the disability nor provide a detailed medical history.
See the discussion of service animals on pages 13-14 of the April 2009 Legal Update, “Wisconsin Rentals,” at www.wra.org/LU0904 (same rules generally apply for rental properties and condominium associations).
Condominium documents
An agent is writing an offer on a condominium and is looking through the condominium documents. There is no mention of it being for older adults only but the documents state that there shall be no minor children allowed to reside in any of the units. Is this illegal?
The 1988 Fair Housing Amendments Act created new protected classes. The members of those protected classes have the right to seek legal remedies against persons who discriminate against them based upon their status. Familial status was among those protected classes. As a result, a condominium declaration or other document prohibiting occupancy by minor children is legally unenforceable. If the condominium association attempts to discourage or prohibit a family with children from occupying the condominium, significant legal liability could result.
Although one might initially assume that this is discrimination based on age, it appears to be discrimination based upon family status. Under Wisconsin’s fair housing laws, age discrimination applies only with respect to persons at least 18 years of age.
The agent may refer the parties to legal counsel to review the condominium documents. The condominium association may consider having an attorney review and amend the governing documents to comply with current federal and state law including fair housing standards.
For further discussion, see pages 5-7 of the March 1998 Legal Update, “Thirty Years After the Federal Fair Housing Act,” at www.wra.org/LU9803.
55 and older housing
A builder has a 55 and older project. The builder has sold one unit to a 74-year-old person and one is rented but the seller doesn’t know the age of the renter. The seller is considering selling to someone who is 50 years old. What concerns should the broker have about listing a 55 and older housing project?
Under both federal and Wisconsin law, housing for persons who are 55 years of age or older means that at least one person who is 55 years of age or older occupies at least 80 percent of the occupied units, and the project adheres to a policy that demonstrates an intent to operate as housing designed for persons who are age 55 or older. Housing projects that meet these requirements are exempt from the prohibitions against discrimination based upon familial status under federal law, and are exempt from the prohibitions against discrimination based upon age and family status under Wisconsin law.
In order for a housing facility or community to qualify as housing designed for persons who are 55 years of age or older, the owner must publish and adhere to policies and procedures that demonstrate the intent to operate as housing for persons 55 years of age or older. These policies and procedures should appear or be referenced in advertising, lease provisions, written rules and regulations, deed restrictions, the actual practices of the housing facility or community and postings in common areas. However, phrases such as “adult living” or “adult community” in written advertisements are not precise enough to demonstrate an intent to operate as housing for persons 55 years of age or older.
In order for a housing project to qualify as housing for persons 55 years of age or older, it also must be able to produce verification of compliance with the 80 percent rule through reliable surveys and affidavits. Such procedures may be part of the leasing or purchasing process, but regular updates of the occupancy and age information must be done at least every two years. Reliable documentation of an occupant’s age includes: driver’s license; birth certificate; passport; immigration card; military identification; other official government documents containing a birth date; or a certification in a lease, application, offer to purchase, affidavit, or other document signed by any member of the household age 18 or older asserting that at least one person in the unit is 55 years of age or older. In addition, the project needs to periodically survey the ages of current residents.
The law also provides protection for real estate licensees and other persons who rely upon representations that a particular property qualifies for the “55 and over” exemption. A person may not be held personally liable for monetary damages for discrimination in violation of fair housing law if the person reasonably relied, in good faith, on the application of the 55 and over exemption. A person may show reasonable reliance, in good faith, if the person can show that:
- He or she has no actual knowledge that the housing is not or will not be eligible for the exemption; and
- The owner of the housing has stated formally, in writing, that the housing complies with the requirements for the exemption.
Thus brokers working with housing projects intended for persons age 55 years or older may be well advised to request a written report or letter from the owner stating that the housing project complies with all legal requirements for the 55 and over exemption under Wisconsin fair housing law.
For additional information regarding senior housing projects and the HUD rules for 55 and over housing, visit http://www.hud.gov/offices/fheo/seniors/index.cfm.
Tracy Rucka is Director of Professional Standards and Practices and Debbi Conrad is Senior Attorney and Director of Legal Affairs for the WRA.