What Does Fair Housing Mean To You? | Thursday Thought

It’s April and that means it’s Fair Housing Month.  It’s also Autism Awareness month, Jazz Appreciation Month, and Mathematics Awareness Month (the square root of pi is… 1.7 apple cobblers).

What does fair housing mean to you, though?  Most likely it factors into your life when you are looking to rent a place to live or are a landlord renting to tenants.  It applies in home sales as well, but is much less frequently an issue in purchase transactions.

On the face it seems fairly simple.  As per a nicely summarized Wikipedia entry:

The Fair Housing Act (Title VIII of the Civil Rights Act of 1968) introduced meaningful federal enforcement mechanisms. It outlaws:

  • Refusal to sell or rent a dwelling to any person because of race, color, religion, sex, familial status, or national origin.
  • Discrimination based on race, color, religion, sex, familial status, or national origin in the terms, conditions or privileges of sale or rental of a dwelling.
  • Advertising the sale or rental of a dwelling indicating preference, limitation, or discrimination based on race, color, religion, sex, handicap, familial status, or national origin.
  • Coercing, threatening, intimidating, or interfering with a person’s enjoyment or exercise of housing rights based on discriminatory reasons or retaliating against a person or organization that aids or encourages the exercise or enjoyment of fair housing rights.

As straight forward as this seems, It’s actually not uncommon for landlords to mistakenly violate fair housing laws.  Let me give you a couple examples which might surprise you:

  • A landlord advertises in a local paper: “One bedroom apartment. Easy access to the city. Perfect for bachelors.”
    • Seems simple enough.  There’s nothing discriminatory in there, right?  Think again.  The landlord is inadvertently stating a preference to a class of persons that he/she wishes to rent to.  “Perfect for bachelors” might be construed as not wanting a single mom there, for instance.  Advertisements like this are considered a violation of the Fair Housing Act.
  • Let’s try this advertisement: “Lovely home for rent.  Walking distance to local churches.”
    • Houston, we have a problem!  Once again this landlord is inadvertently stating a preference.  What if the prospective tenant goes to a temple or a mosque?  What if they aren’t religious in any way?
  • You meet with a landlord to look at renting the second floor of a two family home.  She asks if you have any young children.  She says that she doesn’t want to rent to anyone with young kids because it’ll be too noisy for the people downstairs who have been great tenants for many years.  Sorry, but this is discrimination based on familial status.

As you can see, some things many people consider to be normal verbiage or simple conditions landlords might require, can often be against the law.  What it comes down to – in the most simple terms – is this:

  • A landlord can refuse to rent based on a prospective tenant not meeting credit check/financial requirements.  Those requirements must be the same for all applicants.
  • A landlord can refuse to rent to tenants with pets unless that pet is a certified service animal.  (An important aside here, a landlord can ask for additional security money for pets but CANNOT ask for increased monthly rent).
  • A landlord can refuse to rent based on criminal history in specific instances so long as that is also a policy that is applied equally to all applicants.

Anything else is going to be a violation of FHA laws.  The only time a landlord has some more flexibility here is when renting part of a home that is also that landlord’s primary residence.  That’s a whole other pile of words for another post, though…

Until then, if you think you may have faced discrimination trying to rent or if you’re a landlord who wants to make sure you don’t violate any FHA laws, you can always pop over to the FHA website and investigate more.

How Interest Rates Affect Your Monthly Payment

Considering a real estate purchase in the next year or so? It looks like the Fed’s promise to start increasing interest rates is coming to fruition.

“The Fed on Wednesday raised its benchmark short-term rate by a quarter percentage point to a range of 0.75% to 1% and stuck to its forecast of two more such increases this year and three in 2018. Some economists had expected Fed policymakers to modestly step up the pace.”

It seems NOW is the time to buy and let’s look at why. In the example in my attached picture I show a purchase with a loan of $300,000 over 30 years. The rate in example one is 5% and in example two is 6%. Waiting that extra year or so to buy might end up costing you $189 a month or $67,748 over the course of the entire loan. This is an amount that goes to nothing but the bank. You don’t get a nicer house for it, you don’t get a complimentary box of chocolates!

If you are investing in a property to rent out, then this number can be the difference between a profitable deal and one that isn’t.  So, in the words of every bad late night infomercial… Act now, while supplies last!