Discrimination in Real Estate Sales and Leasing Text Size:

Discrimination in housing is prohibited by the Fair Housing Act of 1968 (FHA) and its amendments. The conduct prohibited includes discrimination in the sale or rental of housing on the basis of race, color, religion, national origin, sex, handicap or familial status. The Americans with Disabilities Act (ADA) prohibits discrimination against disabled people in commercial real estate matters.

Fair Housing Act

The Fair Housing Act was enacted by Congress as Title VIII of the Civil Rights Act of 1968. It was amended by the Fair Housing Amendments Act of 1988 (FHAA). Under the current law, it is unlawful to discriminate in any aspect relating to the sale, rental, advertising, or financing of dwellings based on seven protected classifications, specifically: race, color, religion, national origin, sex, handicap or familial status.

''Dwellings'' include any building or portion thereof that is occupied or intended for occupancy as a residence by one or more families, and any vacant land offered for sale or lease for the construction of any such building. A ''family'' may consist of a single individual.

Discriminatory Practices

The following discriminatory practices are prohibited by the FHA and state and local laws:

• Discrimination in the sale or rental of housing. A person may not refuse to sell or rent after a bona fide offer has been made, nor may a person refuse to negotiate for the sale or rental of, or otherwise make unavailable or deny a dwelling to any person because of race, color, religion, national origin, sex, handicap or familial status.
• Discrimination in advertising for sale or rental. An advertisement in any form that indicates any preference, limitation, or discrimination based on race, color, religion, national origin, sex, handicap or familial status, or that indicates an intention to make such a preference, is prohibited. This prohibition applies to the publisher of the advertisement as well as to the party who places the advertisement. It extends to all advertisements regardless of the medium used.
• False representations of unavailability. A person may not falsely represent to any person because of one of the seven protected classifications that a dwelling is not available for inspection, sale, or rental when that dwelling is in fact available for inspection, sale, or rental. This prohibition creates an enforceable right to truthful information for every person.
• Blockbusting. This is a process through which individuals, such as real estate brokers, artificially stimulate sales of residential property by making representations to homeowners regarding the migration of a particular racial, ethnic, religious, or social group into the neighborhood. The brokers prey on the homeowners' bigotry and fear to increase sales, resulting in depressed market values of property and instability in the neighborhood. Blockbusting is specifically prohibited under 42 U.S.C. § 3604(e), which makes it unlawful for anyone to induce or try to induce any person to sell or rent any dwelling by making a representation regarding the entry or prospective entry into the neighborhood of one or more persons of a particular race, color, religion, sex, handicap, familial status or national origin.
• Steering. This is a practice used by real estate brokers and agents to preserve and encourage patterns of racial segregation by ''steering'' or directing members of racial or ethnic groups to buildings or areas occupied primarily by members of their own racial or ethnic group and away from buildings and neighborhoods inhabited by members of other races or groups. Though not specifically prohibited under the FHA, the means through which steering is most commonly accomplished, such as unlawful refusals to sell or rent and discrimination in terms or conditions, are prohibited.

Exemptions from the FHA

The FHA generally exempts from its coverage:

• Rentals and sales of certain single-family houses, such as if the private individual owner does not own more than three single-family houses at any one time
• Rentals and sales of certain dwellings of four or less units, such as when the owner maintains and actually lives in one of the units
• Rentals and sales of dwellings or lodgings owned or controlled by religious organizations or private clubs
• Reasonable governmental limitations on occupancy
• Certain housing for older persons, such as retirement housing communities where the units are all reserved for people age 62 and older

Relief under the FHA

A person who has been discriminated against in residential housing matters can bring a civil lawsuit under the FHA to obtain relief. If the court finds that a discriminatory housing practice has occurred or is about to occur, it may award to the plaintiff:

• Compensatory damages, which is compensation for actual injuries sustained
• Punitive damages, which is a money judgment meant to compensate the plaintiff for wanton behavior or to punish or make an example out of the defendant
• An injunction or temporary restraining order, which are both orders directing a party to take or not to take a specific action
• Reasonable attorney's fees and costs to the prevailing party, other than the United States

Americans with Disabilities Act

The ADA is a broad civil rights law guaranteeing equal opportunity for individuals with disabilities. It generally provides access requirements for and prohibits discrimination against people with disabilities in public accommodations, state, and local government, transportation, telecommunications, and employment.

The ADA affects the commercial real estate brokerage industry in a manner similar to how the FHA affects the residential real estate business. A commercial real estate broker must determine whether the building, shopping center, or other commercial structure that the broker is selling, managing, or leasing is in compliance with the ADA. If the building is not in compliance with the federal law, the broker may subject himself or herself to a claim of negligent misrepresentation by holding it out to the public as suitable and fit for commercial purposes.

If you have questions about discrimination in residential or commercial real estate matters, contact a real estate attorney in your area for answers on your specific situation.

Questions for Your Attorney

• Can the owner of a small apartment building refuse to rent an apartment to me on the basis of my race? Does it matter whether the building's owner lives there?
• Can I sue a real estate agent who told people in the neighborhood that black people were moving in and then proceeded to sell the homes of those residents who wanted to sell?
• What kind of relief can I get for discrimination under the Fair Housing Act?

Related Resources on Lawyers.com ^sm