Listing remarks
- The Fair Housing Act’s ban on discriminatory advertising applies even to owners who are otherwise exempt.
- Landlords of most pre-1978 housing must give tenants EPA’s lead pamphlet, disclose known lead paint and keep signed disclosures for three years.
- The lead disclosure rule does not apply to housing built after 1977, leases of 100 days or less, or housing tested and found lead-based paint free.
Becoming a landlord means taking on legal duties the day you sign your first lease. Most of them come from state and local law, which varies a great deal: security deposits, notice periods, habitability standards, eviction procedure. But two federal rules apply almost everywhere in the country, and both trip up beginners. This guide explains them using the text of the Fair Housing Act and EPA’s lead disclosure rule.
Part 1: The Fair Housing Act
What it prohibits
The federal Fair Housing Act makes it unlawful, among other things:
- to refuse to rent, refuse to negotiate or otherwise make housing unavailable to anyone because of race, color, religion, sex, familial status or national origin;
- to set different terms, conditions or privileges, or provide different services, for those reasons;
- to make, print or publish any notice, statement or advertisement that indicates a preference, limitation or discrimination based on race, color, religion, sex, handicap, familial status or national origin;
- to tell anyone, for those reasons, that a unit is not available when it is;
- to discriminate because of a handicap, the term the statute uses for disability.
Familial status, as the act defines it, covers households with children under 18. An ad saying “perfect for a single professional” or “no kids” can be a violation even if you never meant to turn anyone away.
Disability: accommodations and modifications
The act treats two refusals as discrimination against a person with a disability: refusing to make reasonable accommodations in rules, policies, practices or services when needed for equal use of the home, and refusing to permit reasonable modifications of the premises, at the tenant’s expense, when needed for full enjoyment. In a rental, the landlord may, where reasonable, condition a modification on the tenant agreeing to restore the interior at the end of the tenancy.
The small-owner exemptions, and their limits
The act exempts two situations from most of its rules:
- a single-family house rented by a private owner who owns no more than three such houses, with further conditions, including not using a broker or discriminatory advertising;
- rooms or units in a building with living quarters for no more than four families, if the owner actually lives in one of them.
Neither exemption covers the ban on discriminatory notices, statements and advertisements. And many state and local fair housing laws protect additional groups and reach owners the federal exemptions leave out. In practice, small landlords should act as if the law applies to them.
Tip: Write down your rental criteria, such as minimum income and rental history, before you advertise, and apply exactly the same criteria to every applicant. Keep the applications and your reasons for each decision.
Part 2: Lead-based paint disclosure
EPA notes that lead-based paint was banned for use in homes in 1978 but is still present in millions of homes. It is usually not a hazard in good condition, but deteriorating paint (peeling, chipping, chalking, cracking or damaged) is a hazard and needs prompt attention.
What landlords must do
For most housing built before 1978, before a tenant signs a lease the landlord or property manager must:
- give the tenant EPA’s pamphlet Protect Your Family From Lead in Your Home;
- disclose any known lead-based paint and lead-based paint hazards in the unit;
- provide all available records and reports on lead in the housing, including common areas and building-wide evaluations in multi-unit buildings;
- keep a signed copy of the disclosures for three years after the lease begins.
The rule requires disclosure, not testing. A renter can ask for an inspection by a certified inspector, but landlords are not required by this rule to provide one. Penalties can apply to a landlord who does not give the required information.
What the rule does not cover
| Not covered by the disclosure rule | Note |
|---|---|
| Housing built after 1977 | |
| Leases of 100 days or less | Only where no renewal or extension can occur |
| Zero-bedroom units such as efficiencies and lofts | Unless a child under six lives there or is expected to |
| Housing for the elderly or people with disabilities | Unless a child under six lives there or is expected to |
| Housing tested and found lead-based paint free | By a certified inspector or risk assessor |
| Foreclosure sales |
Renovating an older rental
Under EPA’s Renovation, Repair and Painting Rule, firms paid to perform work that disturbs lead-based paint in homes built before 1978 must be EPA- or state-certified and must use certified renovators who follow specific work practices. Factor that into renovation budgets for older buildings.
Everything else is local
Beyond these federal rules, check your state and city for security deposit limits and return deadlines, required notices before entry, habitability codes, smoke and carbon monoxide alarm rules, rental registration or inspection, and eviction procedures. A local landlord-tenant attorney or your state’s housing agency are good starting points.
The bottom line
Treat every applicant by the same written standards, keep fair housing in mind when you write ads, respond to accommodation requests seriously, and handle lead disclosure in any pre-1978 building before the lease is signed. These rules are part of the cost of owning a rental; build them into your plan from Buying Your First Rental Property: From Search to First Tenant onward, and see Real Estate Investing Pros and Cons: An Honest Look for how they fit the bigger picture.