The Fair Housing Act: How it Works, Examples

What Is the Fair Housing Act?

The Fair Housing Act, established in 1968, is a federal law that forbids discrimination in most housing-related activities, including buying, selling, renting, or financing, based on race, color, sex, national origin, or religion. It has been amended to include protections against discrimination based on disability and familial status.

The Act generally covers a wide range of housing; however, there are limited exceptions. It does not apply to owner-occupied buildings with no more than four units, single-family houses sold or rented directly by the owner without an agent, and housing operated by religious organizations or private clubs that limit occupancy exclusively to their members. This Act constitutes Title VIII of the Civil Rights Act of 1968.

Understanding the Fair Housing Act

The U.S. Department of Housing and Urban Development (HUD) is the primary enforcer of the Fair Housing Act. HUD’s website provides additional information about what constitutes discrimination under the law, and how to proceed if a person feels that their inclusion in a protected class somehow negatively influenced a decision.

The Civil Rights Act of 1964 paved the way for this legislation. The Civil Rights Act was passed by Congress in direct response to the movement to end racial segregation and injustice in the 1950s and ’60s. The Fair Housing Act was passed by Congress less than a week after the assassination of the Rev. Dr. Martin Luther King, Jr. and was the last of three great pieces of legislation enacted during the Civil Rights Movement.

In 1974, the federal government expanded the Fair Housing Act to include protections for gender, and in 1988, to protect families with children and people with disabilities. Various state and local jurisdictions have added specific protections for sexual orientation and other categories.

In New York, for instance, a bank or landlord can’t inquire about a person’s criminal record, says Damon P. Howard, a real-estate attorney in New York City who handles residential and commercial litigation. New York City also prohibits discrimination on the basis of immigration status or lawful occupation, Howard notes. Prohibitions on racial discrimination have been extended to include wearing ethnic hairstyles, such as dreadlocks, as well as other attributes.

In 2023, during National Fair Housing Month, Rep. Adam Schiff, Sen. Tim Kaine, and Rep. Scott Peters reintroduced the Fair Housing Improvement Act. This bill’s purpose is to safeguard veterans and low-income families against housing discrimination related to their sources of income. It expands the protections provided by the Fair Housing Act of 1968 to encompass source of income and veteran status as newly protected classes. The Act specifically targets discrimination faced by individuals utilizing Housing Choice Vouchers and other legitimate income sources to pay rent, addressing the absence of federal safeguards and documented discrimination cases.

Examples of Housing Discrimination

Here are some examples of what may be considered illegal discrimination under the law:

• A landlord tells a phone caller that an apartment is available, but upon meeting and seeing the caller is Black, falsely claims the apartment was just rented. The apartment is then offered again to a caller of a different race.
• A real estate agent declines to show a house in a certain neighborhood to a buyer due to their race, religion, or ethnicity. Alternatively, the agent might direct a buyer to a different neighborhood than requested, based on similar discriminatory reasons.
• A homeowner advertises a house for sale but explicitly states in the listing that they will not sell to families with young children, thereby discriminating based on familial status, which is prohibited under the Fair Housing Act.
• A mortgage lender imposes a higher interest rate on a home loan for a property in a predominantly Latinx neighborhood compared to a predominantly white area, or offers a loan with unfavorable terms to a borrower based on their sex, race, or nationality.
• A newly built condominium complex does not meet the accessibility standards required for buildings constructed after 1991, making it inaccessible for a potential buyer who uses a wheelchair.
• A rental agent refuses to rent an apartment to a single woman with children.

Fair Housing Act Enforcement

Under the Fair Housing Act, the U.S. Department of Justice (DOJ) may file a lawsuit against a defendant who is alleged to have engaged in a “pattern or practice” of discrimination or discriminated against a group of people such that an issue of “general public importance” is raised. The discretion to determine what constitutes a matter of “general public importance” rests with the U.S. attorney general, as upheld by various court decisions.

Specifically, the DOJ is authorized to pursue lawsuits under the Fair Housing Act in instances of systematic discrimination in the provision of mortgage loans or home improvement loans. The Justice Department can file suit under the Fair Housing Act if there is a pattern or practice of discrimination or where a denial of rights to a group raises an issue of general public importance. The DOJ also holds the authority to press criminal charges in cases where discrimination involves the use of force or threats.

Individuals who believe they have been subjected to discrimination have the right to file complaints directly with HUD, or they can initiate a lawsuit in either federal or state courts. The DOJ undertakes legal proceedings on behalf of individuals, often based on referrals from HUD.

When a discrimination complaint is filed with HUD, the agency is obligated to conduct a thorough and prompt investigation. If the complaint can’t be resolved through conciliation, HUD then decides whether there’s reasonable cause to believe federal laws were violated. Upon finding such reasonable cause, HUD issues a Charge of Discrimination. Within 30 days, either the person alleging the discrimination or the respondent can choose to have the charge tried in federal court or in a HUD administrative law court.

Federal Court Trial vs. Administrative Hearing

If the person filing the discrimination complaint chooses a federal court trial, they would be represented by DOJ attorneys and the case would be heard by a judge or a jury. Should the complainant win, they could receive both compensatory and punitive damages. Moreover, if the individual’s complaint was part of a larger “pattern and practice” of discrimination, the DOJ could file broader charges seeking relief for other individuals who also were affected and go after civil penalties—a fine paid to the government.

On the other hand, opting for an administrative hearing, conducted by HUD, involves representation by HUD attorneys and adjudication by an administrative law judge. This process typically concludes faster than a federal court trial. Successful complainants in this setting can see the defendant receive civil penalties and get compensatory but not punitive damages.

Both types of courts can order injunctive relief and issue written opinions, and appeals of the decision can be made to the U.S. Court of Appeals, according to the DOJ.

Special Considerations

Housing and civil rights attorneys say that proving housing discrimination, unless it is overt and obvious, can be difficult and that collecting good evidence in the form of written records and documents is helpful. They suggest that an individual who believe they have been a victim of discrimination contact their local fair housing center or an attorney for guidance.

Some states and local jurisdictions provide additional fair housing protections that go beyond federal laws. For instance, New York State Human Rights Law provides all the protections of the federal Fair Housing Act, but also affords protection against discrimination on the basis of “creed…national origin, sexual orientation, gender identity or expression, military status, age …lawful source of income.”

The Bottom Line

The Fair Housing Act is a cornerstone of civil rights legislation. The act prohibits discrimination in housing based on race, color, religion, sex, national origin, familial status, or disability. Enforced primarily by HUD and the DOJ, the Act ensures equitable treatment in housing-related transactions.

Despite legal protections, challenges in proving discrimination persist, requiring thorough documentation and often, legal assistance. Enforcement mechanisms include federal and administrative court trials, where victims can seek compensatory and, in some cases, punitive damages as high as $150,000. State laws that offer additional protections beyond the Fair Housing Act enhance its effectiveness, demonstrating the Act’s importance in advancing housing fairness.