Lesson 7: Civil Rights and Fair Housing

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Lesson 7: Lesson 7: Civil Rights and Civil Rights and

Fair Housing Fair Housing

Real Estate Principles of Georgia

1451 of 42

© Copyright 2006, Rockwell Institute, Inc.

Introduction

Federal and state laws prohibit discrimination:

based on race, religion, sex, or other characteristicsapply to almost all real estate transactions

Particular laws vary in terms of:what groups they protect, andwhat types of activities and transactionsthey apply to.

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Federal Antidiscrimination LawsCivil Rights Act of 1866

Civil Rights Act of 1866:prohibits discrimination only on basis of race applies to any type of real estate transaction:

residential or commercialimproved or unimproved

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Not widely used until after 1968 Supreme Court decision Jones v. Mayer :

Court held act prohibits “all racial discrimination, private or public, in the sale and rental of property.”

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Civil Rights Act of 1866Remedies

Remedies available under 1866 act include:

injunction (order to stop violation)actual damages (to compensate plaintiff)punitive damages (additional amount as a penalty)

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Civil Rights Act of 1964 prohibits discrimination:

based on race, color, religion, or national originin programs and activities that receive financial assistance from federal government

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Title VIII of the Civil Rights Act of 1968 is better known as the Fair Housing Act.Applies to sale or lease of:

residential propertyvacant land to be used for residential construction


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In residential transactions, Fair Housing Act also prohibits discrimination in:

advertisinglendingbrokerageother services

Federal Fair Housing ActScope of law

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Fair Housing Act prohibits discrimination based on:

Federal Fair Housing ActScope of law

racecolorreligionsex

national originDisability/handicapfamilial status

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Fair Housing ActExemptions: For sale by owner

1. Doesn’t apply to a single-family home rented or sold by a private individual if:

she owns no more than 3 such homesno discriminatory advertising usedno real estate broker employed

If owner isn’t most recent occupant, she may use this exemption only once every 24 months. 149


2. Doesn’t apply to rental of a room or unit in a dwelling with up to four units if:

owner resides in one of the unitsno discriminatory advertising usedno real estate broker employed

Fair Housing ActExemptions: Owner-occupied rental

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3. Religious organizations may limit occupancy to members when dealing with their own property.

4. Lodgings belonging to private clubs may give preference to their own members, so long as lodgings are not open to general public.

Fair Housing ActExemptions

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Fair Housing Act always applies to any transaction involving a real estate agent.

Exemptions aren’t permitted when agent is involved.Agent may never discriminate.

Fair Housing ActExemptions

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Fair Housing ActDiscriminatory Actions

• Refusal to rent or sell residential property after receiving a good faith offer.

• Refusal to negotiate for the sale or rent of residential property.

• Any other action that would make residential property unavailable.

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• Discriminating in terms or conditions of sale or rental of residential property.

• Discriminatory advertising that indicates a preference or limitation.

• Representing that property is not available for inspection, rent, or sale when it is in fact available.


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Fair Housing Act also prohibits:

steeringblockbustingredlining

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Discriminatory ActionsSteering

Steering: Channeling prospective buyers or tenants to or away from particular neighborhoods based on their race, ethnicity, or another protected characteristic.

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Discriminatory ActionsBlockbusting

Blockbusting: When someone tries to induce homeowners to sell by predicting that:

members of minority groups will be moving into neighborhoodproperty values and quality of life will suffer as a result

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Discriminatory ActionsRedlining

Redlining: When lender refuses to make mortgage loans in particular neighborhood because of its racial or ethnic composition.

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Fair Housing ActHandicap

1988 amendments to Fair Housing Act added handicap and familial status as protected categories.

“Handicap” refers to:physical and mental disabilitiesthat substantially limit one or more major life activities.

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HandicapReasonable accommodations

Landlord must:make reasonable exceptions to rules for disabled tenants, andallow disabled tenants to make reasonable modifications at their own expense.

Landlord isn’t required to modify property for tenant.

Tenant can be required to restore property to original condition when tenancy ends.

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HandicapWheelchair accessibility

Fair Housing Act’s wheelchair access rules apply to new construction of residential buildings with four or more units.

New construction: built since 1988.Entryways, hallways, kitchens, and bathrooms must be designed to accommodate wheelchairs.If building has an elevator, units above ground floor must accommodate wheelchairs.

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Fair Housing ActFamilial status

Familial status refers to parents or guardians who have children under 18 living with them.

Generally illegal to refuse to rent or sell to someone because:

she is pregnanthe or she has childrenhe or she is about to adopt or gain custody of children 151


Familial StatusHousing for older persons

“Housing for older persons” is exempt from the prohibition against discrimination against families with children.

Determining whether a property is intended for older persons involves consideration of:

design,facilities, andadvertising.

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To qualify as housing for older persons, a property must fit one of three categories:

1. Developed under government program to assist the elderly.

2. Intended for and solely occupied by people age 62 and older.

3. Intended for people age 55 and older:designed to meet their physical or social needs, andat least 80% of the units are occupied by at least one person 55 years or older.

Fair Housing ActHousing for older persons

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Fair Housing ActEnforcement

Office of Fair Housing and Equal Opportunity is part of Department of Housing and Urban Development (HUD).

HUD sometimes uses testers: persons who pretend to be trying to obtain housing, to evaluate compliance with fair housing laws.

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Fair Housing ActEnforcement

Person who feels she has been discriminated against in violation of Federal Fair Housing Act may:

file a complaint with Office of Fair Housing and Equal Opportunity, orfile a lawsuit in state or federal court.

Complaint must be filed within one year of the discrimination.Lawsuit must be filed within two years.

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EnforcementAdministrative hearing

If complaint filed with HUD, agency investigates and tries to resolve issue between parties.

If that doesn’t work, administrative hearing is held.

HUD attorneys represent complainant, and administrative law judge hears case. 152


EnforcementPenalties

Possible penalties:an injunction against discriminatory activity,affirmative steps to correct a violation,compensatory and/or punitive damages, and/ora civil penalty paid to federal government.

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SummaryFederal Fair Housing Act

Civil Rights Act of 1866Civil Rights Act of 1964Fair Housing ActSteeringBlockbustingRedliningHandicapFamilial status

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Other Federal LawsAmericans with Disabilities Act

ADA (1992) is intended to ensure disabled people equal access to all public accommodations.

Disability: any physical or mental impairment that substantially limits one or more major life activities.

Public accommodation: a private entity with facilities open to the public.

Examples: real estate offices, banks, stores153


If “readily achievable” in public accommodation:

architectural and communications barriers must be removedauxiliary aids and services must be provided

New commercial construction must be accessible to disabled, unless structurally impractical.

Americans with Disabilities ActRequirements

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Georgia Antidiscrimination LawsGeorgia has its own Fair Housing Law with provisions mirroring those of the federal Fair Housing Act.

It bars discrimination in housing, if it is based on race, color, religion, sex, handicap, familial status, or national origin.

Georgia’s Fair Housing Law is enforced by the State Commission on Equal Opportunity.

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SummaryOther Federal Laws

Equal Credit Opportunity ActHome Mortgage Disclosure ActAmericans with Disabilities ActDisabilityPublic accommodation


Complying with Fair Housing Laws

Violating laws doesn’t require intent to discriminate; even good intentions can lead to problems.

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Complying with Fair Housing LawsWorking with clients

Real estate agents should never say or imply that presence of persons of a protected class in a neighborhood will:

lower property values,change the neighborhood’s composition,create a more dangerous neighborhood, or cause a decline in the quality of schools.

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Complying with Fair Housing LawsWorking with clients

Watch for signs of discriminatory attitudes to avoid helping others violate antidiscrimination laws.

If sellers aren’t willing to follow the law, decline the listing.

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Complying with Fair Housing LawsDiscriminatory practices

Certain statements/practices may be construed as discriminatory:

Advertising property only in neighborhoods where residents are of same background as seller.Sending property flyer to all neighboring properties except those owned by people of particular race or background.

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Complying with Fair Housing LawsDiscriminatory practices

Wording an ad so that it suggests that recipient can control who buys property (“uphold standards of the community”).Choosing non-diverse models in display advertising.

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Complying with Fair Housing LawsActions that don’t violate laws

Asking questions or making statements as necessary to accommodate needs of disabled person.Positive measures to reach out to members of protected class.

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This type of covenant still appears in chain of title of some older properties.

Such a covenant does not invalidate deed, although covenant itself is unenforceable.

Discriminatory Restrictive Covenants

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SummaryComplying with Antidiscrimination Laws

Working with clientsAdvertising propertiesNon-discriminatory actionsDiscriminatory restrictive covenants

Lesson 7: Civil Rights and Fair Housing

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