Rent­ing to high­est bid­der could be dis­crim­i­na­tory

Los Angeles Times - - BUSINESS BEAT - By Anky van Deursen Van Deursen is di­rec­tor of Dis­pute Res­o­lu­tion Pro­grams for Pro­ject Sen­tinel, a Bay Area non­profit. Send ques­tions to info@ hous­ing. org.

Ques­tion: With the rental mar­ket in many ar­eas of the coun­try hot right now, I want to be sure I’m max­i­miz­ing the re­turn on my in­vest­ment by get­ting what­ever rental amount the mar­ket can sup­port. My rental unit is in a non- rent­con­trolled com­mu­nity.

To that end, I want to ad­ver­tise one of my rental prop­er­ties as “$ 2500/ mo., or best of­fer.” Just as is done in home sales, I want to make space for a bid­ding war on my rental prop­erty so I can get as much as pos­si­ble in rental in­come. Should I be wor­ried about any fair hous­ing li­a­bil­ity here? An­swer: Although there is no black- and- white an­swer to this ques­tion, hav­ing a pol­icy of choos­ing the ten­ant will­ing to pay the most money might present a prob­lem un­der the fair hous­ing laws.

Although land­lords can usu­ally charge as much rent for an apart­ment as prospec­tive ten­ants are will­ing to pay, they must choose ten­ants us­ing cri­te­ria that are not dis­crim­i­na­tory.

Fair hous­ing agen­cies tend to look with a care­ful eye at three kinds of ten­ant se­lec­tion cri­te­ria: ( 1) those that are de­lib­er­ately dis­crim­i­na­tory, such as rent­ing only to ten­ants who do not have chil­dren; ( 2) those based on sub­jec­tive con­sid­er­a­tions, such as rent­ing to some­one you just “felt more com­fort­able with;” and ( 3) those that have the ef­fect of dis­crim­i­nat­ing against mem­bers of a pro­tected group, such as fam­i­lies with chil­dren.

This third type of case could stem, for in­stance, from a pol­icy of not rent­ing one- bed­room apart­ments to more than two peo­ple. Such a case de­pends upon sta­tis­ti­cal anal­y­sis of the im­pact of a pol­icy on groups pro­tected un­der the law.

Hav­ing a rental pol­icy of rent­ing to the ten­ant who of­fers to pay the most rent does not de­lib­er­ately dis­crim­i­nate against ten­ants in a pro­tected group since ten­ants with less money are not a pro­tected group un­der the law. Nor is choos­ing a ten­ant based on who makes the best of­fer con­sti­tute a sub­jec­tive se­lec­tion cri­te­ria. Rather it is based on an ob­jec­tive of­fer to pay a cer­tain amount of rent.

How­ever, be­cause in­come can be sta­tis­ti­cally linked with some pro­tected groups, in­clud­ing race, gen­der and dis­abil­ity, it is pos­si­ble that a pol­icy of rent­ing to the high­est bid­der might have the ef­fect of dis­crim­i­nat­ing against one or more of these pro­tected groups. Such a case is heav­ily de­pen­dent upon de­mo­graphic and sta­tis­ti­cal anal­y­sis, how­ever, and prob­a­bly would be dif­fi­cult to prove.

That aside, how­ever, the ten­ant will­ing to pay the most rent is not nec­es­sar­ily the best ten­ant to have.

For more in­for­ma­tion, con­tact a lo­cal fair hous­ing or me­di­a­tion pro­gram, or Pro­ject Sen­tinel at ( 888) 324- 7468, or visit www. hous­ing. org.

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