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Are individual property owners always required to follow the Fair Housing Act?

Are individual property owners always required to follow the Fair Housing Act

Answer provided by Neil B. Garfinkel REBNY Broker Counsel, Partner-in-charge of real estate and banking practices at Abrams Garfinkel Margolis Bergson, LLP.

Answer:

With respect to individual property owners, there are limited circumstances in which they are not required to follow the FHA or New York State Human Rights Law. More specifically, the FHA and New York State law exceptions include:

  • Owner-Occupied Buildings: In general, the FHA does not apply to buildings with four units or less if at least one of those units is occupied by the owner. However, New York State Human Rights Law is much narrower. Only an owner who occupies a One- or Two-Family residential property can take advantage of a fair housing exception in New York. In this instance, New York State Human Rights Law overrides the FHA, since it is more strict than the FHA. 
  • Single Family Homes: The sale or rental of single-family homes are generally exempt from the FHA, provided that the owner does not own three or more units and a real estate agent is not used in the sale or rental of said home.

Real estate licensees and owners are forbidden from advertising or making any statement indicating a limitation or preference based on an individual’s status as a member of a protected class. Accordingly, although an owner may have the right to avail themselves of the exception(s) set forth above, real estate licensees cannot represent such an owner because the real estate licensee and the owner are forbidden from communicating (with others or each other) the owner’s decision with respect to not following fair housing laws based upon such exceptions. To further clarify: (1) while an owner may choose not to follow fair housing laws based on the above exceptions, the owner may not advertise or make any statement that expresses their desire not to follow fair housing laws and (2) real estate licensees must always follow fair housing laws.

Important Tip: Discriminating against an individual based upon his or her status as a member of the protected categories of race, color and national origin is always forbidden under the FHA. These categories are protected by the FHA without exception. Accordingly, regardless of the above exceptions, an owner can never discriminate against someone based on their race, color or national origin.

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