The Department of Housing and Urban Development (HUD) will officially begin investigating fair housing complaints related to gender identification and sexual orientation, according to a memo from the agency this morning.
The move arrives on the back of President Biden's Day 1 executive order aiming to "prevent and combat discrimination" among these classes. HUD also cites the recent Supreme Court case Bostock v. Clayton County, which found an employer's firing of a transgender worker in violation of the Civil Rights Act.
"Housing discrimination on the basis of sexual orientation and gender identity demands urgent enforcement action," said Jeanine M. Worden, acting assistant secretary of HUD's Fair Housing and Equal Opportunity division. "Every person should be able to secure a roof over their head free from discrimination, and the action we are taking today will move us closer to that goal.
According to a HUD spokesperson, the department saw nearly 200 complaints regarding gender- or sexual orientation-related discrimination in the last year. These cases -- at least those dating back to Jan. 20, 2020 -- can now be investigated.
"Gender" has always been a protected class in the Fair Housing Act, but until the Bostock case and Biden's recent executive order, that legally meant biological sex -- which did not extend to transgender, nonbinary, or other non-cis-identifying people. Sexual orientation was also not explicitly included.
Under these new measures, the Act can now be interpreted more broadly.
"Enforcing the Fair Housing Act to combat housing discrimination based on sexual orientation and gender identity isn't just the right thing to do -- it's the correct reading of the law after Bostock," said Damon Y. Smith, principal deputy general counsel. "We are simply saying that the same discrimination that the Supreme Court has said is illegal in the workplace is also illegal in the housing market."
HUD's new measure will cover already-filed complaints and new incidents dating back to Jan. 20, 2020 -- one year from President Biden's executive order. According to a HUD spokesperson, the date reflects the one-year statute of limitations on these types of cases.
What it means for real estate investors
If you have a rental property -- even a short-term one -- you'll want to take note of the changes, as they'll play into how you can market your unit, qualify and screen tenants, set terms and pricing, and more.
Under the new expanded interpretation of the law, tenants (or potential tenants) can file a complaint for any alleged discrimination relating to their gender identity or sexual orientation.
Here are some examples that might fall under this umbrella:
- Asking a prospective tenant about their gender identity or sexual orientation in the screening process.
- Steering a potential LGBTQ tenant to an area of your building where other LGBTQ tenants currently live.
- Setting higher credit score minimums for tenants who identify as female than those who identify as male.
- Telling a tenant you have no available units (when you do) because you're uncomfortable with their gender identity or sexual orientation.
There are tons of other potential violations, but until HUD begins processing its backlog of cases from last year, there aren't any hard-and-fast examples to pull from. Once those complaints are investigated, there should be more clarity for landlords regarding these new protections.
The bottom line
The Fair Housing Act has been around for a while, so if you were already in line with its protections, today's news shouldn't require any huge changes on your part.
At the end of the day, the takeaway is simple: A tenant's sexual orientation and gender identity should play no role in their ability to secure housing from you or keep it.
As always, consult an attorney if you're worried you may be in trouble regarding a past incident or in how you currently screen, qualify, or treat your tenants. They can provide personalized legal advice to help.