Avoiding Liability for Discrimination Under State & Local Fair Housing Laws

Because enforcement is so active and penalties are so high, it’s easy to forget that complying with the federal Fair Housing Act (FHA) may not be enough to insulate your community from liability. That’s because most states (and many municipalities) have adopted their own fair housing laws that go beyond the minimum FHA requirements, particularly with regard to the kinds of people they protect. For example, 23 states ban discrimination on the basis of sexual orientation.

Because enforcement is so active and penalties are so high, it’s easy to forget that complying with the federal Fair Housing Act (FHA) may not be enough to insulate your community from liability. That’s because most states (and many municipalities) have adopted their own fair housing laws that go beyond the minimum FHA requirements, particularly with regard to the kinds of people they protect. For example, 23 states ban discrimination on the basis of sexual orientation. Accordingly, rejecting applicants because they belong to the LGBT community can lead to stiff penalties under state law, even if they don’t technically violate FHA requirements.

With this in mind, we’ve dedicated this month’s issue to state fair housing laws. The first thing we’ll do to help you comply is give you a Checklist of State Fair Housing Protections so, no matter which state—or states—you operate in, you’ll know which classes are protected from discrimination. Then, we’ll explain what you must do to avoid discriminating against each of the eight groups that are most commonly protected by state laws. At the end of the lesson, you can take the Coach’s Quiz enabling you to apply the analysis to real-life situations and determine how well you’ve learned the material.


The FHA makes it illegal to refuse to rent or deny a person housing because of their race, color, religion, sex, handicap (disability), familial status, or national origin. But federal requirements are just the baseline for compliance. The U.S. Constitution allows states to establish parallel laws. Rule: State laws can’t be any less, but they can be more, restrictive than their federal counterparts.

In the context of fair housing, these principles play out in the form of state discrimination laws that overlap with and are substantially similar to the FHA in terms of the conduct they prohibit. The principal difference is in the scope of protection the laws afford. As our Checklist of State Fair Housing Protections shows, 37 states (and the District of Columbia) have adopted fair housing laws that ban discrimination on the basis of additional grounds not listed in the FHA. The most common grounds are matrimonial status, age, sexual orientation, gender identity and expression, and ancestry.

The core seven bases of discrimination banned by the FHA have been interpreted broadly as encompassing other characteristics and circumstances that state fair housing laws expressly cover. Thus, for example, state law bans on pregnancy discrimination and domestic violence victim status make explicit what the FHA ban on sex discrimination only implies; similarly, the specific protections for HIV status and possession of a service animal found in some state fair housing laws are a clarified version of FHA protections against disability-based discrimination.

Local Fair Housing Laws

Being aware of state rules isn’t enough. To ensure compliance, landlords must also consider whether their municipality has adopted fair housing laws that expand protections beyond those required under the FHA and state law. Additional bases of protection under municipal laws can encompass everything from political affiliation to personal appearance.

At least three states (Arkansas, North Carolina, and Tennessee), however, have enacted laws restricting local governments from expanding grounds of antidiscrimination law protections beyond those covered by state law. Some states have also banned municipalities from extending certain types of protections. For example, in at least two states (Texas and Indiana), municipalities aren’t allowed to adopt local ordinances banning discrimination based on source of income that would require landlords to accept Section 8 housing vouchers.

Bottom Line: It’s crucial to consult an attorney knowledgeable of local laws in each state and municipality where you operate.


The FHAP & State Enforcement

Enforcement of side-by-side federal, state, and local fair housing laws can be tricky. The basic rule is that the U.S. Department of Housing and Urban Development (HUD) enforces the FHA, and states and localities enforce their respective laws. However, the Federal Fair Housing Assistance Program (FHAP) provides enforcement coordination while providing states and localities enforcement leeway. The way it works: Agencies responsible for enforcing state or local fair housing laws apply to HUD for what’s called “substantially equivalent” certification. HUD grants certification if it finds that the state or local law provides substantive protections equal to or greater than the FHA. Local fair housing groups can also get certification.

HUD directs the fair housing complaints it receives to certified agencies and groups so they can pursue enforcement action and, in many cases, provides federal funding for testing, education, and other initiatives. Certification lasts five years, during which agencies must meet minimum procedural standards and prepare what are called Assessments of Fair Housing (AFH) documenting levels of segregation and disparities in access to key opportunity factors and the issues that contribute to them. The AFH process enables HUD and state and local agencies to identify and address larger systemic problems that may be contributing to segregation or having a disparate impact on members of a protected class.



The same practices that are illegal under the FHA—deliberately excluding, providing less favorable rental terms, steering, etc.—are equally illegal under state and local fair housing laws. Similarly, the thing you must do to comply with the FHA—that is, apply the same nondiscriminatory standards on a consistent basis to all regardless of race, etc.—is what you must do to comply with state and local laws. The principal challenge with state and local fair housing compliance is to apply these principles to persons beyond the core seven protected classes of the FHA. While laws vary geographically, there are eight common protected classes that you must ensure your rental processes, policies, and practices don’t discriminate against.

Rule #1: Avoid Marital Status Discrimination

The ban on family status discrimination contained in the FHA makes it illegal to exclude or otherwise adversely treat applicants and renters because they have children. Nearly half the states and many municipalities take it a step further by banning discrimination based on marital status—that is, whether they’re single, married, divorced, or widowed. Examples:

  • Refusing to rent to unmarried couples for religious or moral reasons;
  • Making unmarried households pay higher rent or meet higher income thresholds than married households;
  • Expressing a preference for married couples in your advertising;
  • Setting curfews or overnight guest restrictions for single residents;
  • Requiring unmarried couples to document that they have joint bank accounts; or
  • Evicting a tenant who’s qualified to remain because his or her spouse moves out.

Marital status discrimination may occur when you calculate the income of unmarried applicants who want to share an apartment. Rule: If you let married households combine their incomes to qualify, you must let unmarried households do the same.

Example: A California landlord learned that a prospect to whom he had already offered a lease planned to share the apartment with his boyfriend. So, he withdrew the offer and told the prospect that both he and his partner had to individually satisfy a $90,000 yearly income standard. The applicant asked if he could aggregate his income with the partner’s, but the landlord said no because they weren’t married. The California Department of Fair Employment and Housing sued the landlord for marital status discrimination. In July 2018, the landlord shelled out $7,500 to settle the case [DFEH v. Sarfield].

Landlords have challenged state law bans on marital status discrimination as a violation of a landlord’s right to reject unmarried couples on religious principles. Most of these cases have failed in court. However, one of the states where marital status discrimination is banned, North Dakota, stipulates that the law doesn’t prevent “a person from refusing to rent a dwelling to two unrelated individuals of opposite gender who are not married to each other.”

Coach’s Tip: Recognize that regardless of whether state or local laws ban marital status discrimination, excluding or discriminating against unmarried couples because they have kids under age 18 violates the federal FHA.

Rule #2: Avoid Sexual Orientation & Gender Identity Discrimination

Sexual orientation and gender identity is the most common form of housing discrimination banned by state laws and not the FHA—although HUD has made it clear that such discrimination is illegal under federal law (see the box below). While there’s a tendency to lump these together, they actually refer to discrimination targeting three particular groups in the LGBT continuum:

  • Sexual orientation discrimination, which is banned in 23 states and the District of Columbia, generally refers to an individual’s actual or perceived orientation as heterosexual, homosexual, or bisexual;
  • Gender identity, which is banned in all but one of the states that ban sexual orientation discrimination (Wisconsin is the exception), refers to an individual’s personal sense of being a male, female, a blend, or neither; and
  • Gender expression, which is covered in some but not all gender identity states, refers to outward appearance of gender identity, typically expressed through clothing, behavior, voice, or hairstyle.  

In addition, there are six states (Florida, Kansas, Nebraska, New Mexico, North Dakota, and Pennsylvania) that don’t expressly ban sexual orientation and gender identity discrimination but still recognize such complaints in courts or administrative proceedings.

Examples of pitfalls to avoid:

  • Refusal to rent to an otherwise qualified gay couple because you believe that homosexuality is a sin;
  • Actions based on stereotypes of how you believe people of a particular gender should behave, such as asking a transgender tenant not to dress in women’s clothing in the common areas of the building;
  • Refusing to rent to a gay male because you fear he has AIDS; and
  • Asking rental applicants or tenants questions about their gender expression (such as asking a female applicant why she has a crew cut), relationships between household members (such as asking if those members are in a sexual relationship), and marital status.

Example: In April 2017, a U.S. district judge handed down one of the first cases finding LGBT discrimination under the FHA by ruling against a Colorado landlord who refused to rent a home to a married lesbian couple. When asked for a reason, the landlord cited the couple’s “unique relationship.” According to the court, the landlord’s “stereotypical norms are no different from other stereotypes about women, such as the way they should dress or act” [Smith v. Avanti, 249 F. Supp. 3d 1194].

Example: In November 2018, the Hawaii Civil Rights Commission found a landlord liable for gender identity discrimination and ordered it to pay a tenant $95,000 in damages. The troubles began six years earlier when the landlord first met the tenant and noticed she was using a male name and presenting as a male. From that point forward, the tenant was allegedly subjected to repeated harassment and eventually forced to leave the property. The commission sided with the tenant, citing the emotional distress she testified to have suffered, as well as the expert testimony of the stigmatization transgender individuals experience as a result of being harassed [Boyd v. Primack].

The HUD Equal Access Rule

Even though the FHA doesn’t mention sexual orientation, gender identity, or marital status, public and federally assisted housing providers must comply with HUD’s Equal Access Rule, which requires equal access to HUD programs without regard to those characteristics. And on Feb. 11, 2021, less than a month after President Biden took office, HUD issued a Memorandum stating that HUD will now treat LGBT and marital status discrimination complaints the same way it treats complaints based on the FHA core seven protected characteristics of race, religion, sex, etc.

Rule #3: Avoid Age Discrimination

The fair housing laws of 18 states currently include age as a protected class. However, all age discrimination laws aren’t the same. How the law actually applies depends on how it defines “age.” There are two basic approaches:

  • All Adults: In the many states that define “age” as 18 and older, it’s illegal to discriminate against adult applicants because you consider them as being either too young or too old to live in a particular community or area of a community.
  • Older Adults: A few age discrimination states limit protection to older adults, typically individuals 40 and over. Virginia bans not age, but “elderliness” discrimination, defined as covering individuals 55 and older.

Even where state and local laws don’t expressly ban age discrimination, using age-based criteria to make rental decisions may constitute illegal family status discrimination when it excludes children under age 18 (assuming the property doesn’t qualify for a senior housing community exemption).

Example: In January 2019, a local North Carolina chapter of the National Fair Housing Alliance (NFHA) received a complaint that a 165-unit community was advertising itself as “a multi-professional adult living community” where occupants must be “30 years or older.” Although North Carolina doesn’t ban age-based housing discrimination, in 2020, the owner of the community forked over $97,000—$70,000 to the NFHA and $27,000 in grants to provide housing assistance to local low-income families—to settle charges of family status discrimination under the federal FHA [Independence Place of Charlotte, Inc.].

Rule #4: Avoid Ancestry Discrimination

Arguably, ancestry is already covered by the FHA ban on “national origin” discrimination. “National origin” means the geographic area in which a person was born or from which his or her ancestors came, according to HUD’s 2016 guidance on fair housing protections for Persons with Limited English Proficiency. Although language discrimination is not necessarily national origin discrimination, HUD says that national origin discrimination includes discrimination because an individual has the physical, cultural, or linguistic characteristics of persons from a foreign geographic area.

The problem is that the federal law doesn’t provide a definition of “national origin.” That leaves room to argue that the federal protection applies only to the country where applicants were born, rather than where their families come from. This may explain why 14 states add ancestry to their list of protected characteristics.

Bottom Line: You can’t exclude or treat applicants and tenants unfavorably just because their families come from a foreign country. Also avoid policies and practices that are based on a person’s language, accent, physical appearance, cultural customs, or dress.

Rule #5: Avoid Creed Discrimination

Fifteen states supplement the federal ban on religious discrimination by making creed a protected class. Creed refers to a set of moral or ethical beliefs and the practices and observances associated with those beliefs. Creed often is but doesn’t necessarily have to be based on a church or religious group (although some states limit protection to “religious creed”). Companies, societies, and disciplines might also adopt a creed, as in a political creed, a national creed, or a management creed, that lays out a particular belief-system or way of doing things.

In New York City, both state and local laws ban housing discrimination based on creed, including the perception of those beliefs by others, according to Fair Housing NYC, a joint website of the New York City Commission on Human Rights and Department of Housing Preservation and Development. You don’t need to support a belief to be discriminated against because of it. The negative perception of others may be based on your dress, jewelry, a book you carry, or a symbol on a tee shirt. The city’s website cites the following behaviors, policies, or practices as potential evidence of creed discrimination:

  • A Craigslist advertisement states that the owner prefers “Christians”;
  • A real estate agent tells a rental applicant whose last name is Rosenbaum or Goldberg that she’ll be happier in a nearby area where “all the Jews live;” or
  • A landlord denies a tenant services after observing her with a bible published by a group he described as a “cult.”

Creed generally doesn’t protect a person based on his political or social views, such as rejecting a rental applicant because he’s a member of the Ku Klux Klan. While no court has yet to address the question, in the context of COVID-19, it’s unlikely that individuals could make a valid case for creed discrimination simply because they subscribe to the principles of the anti-vaccination movement.

Rule #6: Avoid Source of Income Discrimination

While age, ancestry, and creed have been long-established, some new forms of discrimination protection are more recent in vintage. After sexual preference and gender identity, the most popular of these new protections is source of income. There are currently 17 states (and the District of Columbia) where you can’t discriminate against rental applicants or tenants because of where their income comes from. These protections typically apply to wages, retirement benefits, child support, and public assistance. With a few exceptions (most notably, California), most source of income states make it illegal to deny renting to people because they receive Section 8 vouchers or other housing subsidies.

Example: In July 2020, the NFHA reached a settlement agreement with a Washington, D.C., community that allegedly used its website to discourage Section 8 rentals. According to the complaint, the website required prospects to identify whether they intended to use a Section 8 voucher to pay rent and prevented them from scheduling an apartment viewing if they answered “yes.” NFHA also claimed that when its testers called the company to ask about viewing an apartment, the owners consistently indicated that they didn’t accept vouchers.

Under the settlement, the company agreed to end its alleged source-of-income discriminatory practices, require all staff to complete fair housing training practices and run ads and post signs in both English and Spanish stating that the company accepts housing vouchers.

Rule #7: Avoid Military Status Discrimination

California, New York, Massachusetts, Illinois, and most recently Virginia are among the eight states that ban housing discrimination on the basis of a person’s military or veteran status. In part designed to prevent the kind of backlash experienced by veterans returning from the Vietnam War in the late 1960s and early 1970s, these laws generally protect active duty members and veterans of the armed forces, reserves, and state National Guard. Some states base fair housing protections for veterans on the nature of their discharge. For example:

  • Illinois bans discrimination based on both military status and “unfavorable discharge from military service”;
  • Military status protection in Washington covers only honorably discharged veterans; and
  • Rhode Island bans discrimination based on “military status as a veteran with an honorable discharge or an honorable or general administrative discharge,” or “servicemember in the armed forces.”  

As is true for any other protected class, the legal obligation to refrain from military status discrimination doesn’t mean you have to offer preferential treatment. However, regulatory guidance in some states and localities suggest that military discounts or other forms of preferential treatment aren’t illegal, either. For example, guidelines from the New York City Commission on Human Rights explain that the municipal bylaw banning military status discrimination doesn’t ban “housing providers and business owners from offering privileges or preferences because of a person’s military service. For example, a movie theater may provide a discount to former or active military service members.”

Rule #8: Avoid Domestic Violence Status Discrimination

Five states, the District of Columbia, and numerous municipalities make it illegal to discriminate against victims of domestic violence or abuse. This is critical to recognize, especially if you’re inclined to follow the common tendency of treating all rental applicants and tenants involved in domestic violence and adopt “zero tolerance” policies to exclude or evict them.

Explanation: While keeping your community safe and secure is an imperative, you must also differentiate between the victims and victimizers. However noble you think your intentions may be, a pox-on-both-your-houses policy that lumps both groups together constitutes not only domestic violence discrimination under state and local laws, but also sex discrimination under the FHA to the extent that victims are almost always women.  

A common example is to reject applicants after learning they’ve been repeatedly assaulted by an intimate partner because you’re afraid the perpetrator will follow the victim to your own community.

Example: A landlord allegedly wouldn’t let a female prospect apply for a rental upon finding out that she had a domestic violence protection order against an individual. The Kentucky Human Rights Commission found probable cause to believe the landlord committed sex discrimination. Rather than risk an administrative trial, the landlord agreed to pay $5,000 and, more significantly, submit to three years of compliance monitoring to settle the case [Jones v. Feldman, April 2013].

Example: Just 72 hours after having to flee her apartment to escape the assault of her ex-boyfriend, a Mississippi tenant was socked with another cruel blow, this time from her landlord in the form of a notice citing the “zero tolerance” provision of the lease and giving her six days to clear out. HUD investigated and determined that the zero tolerance policy amounted to disparate impact sex discrimination and charged the landlord with an FHA violation, forcing the landlord to make a difficult choice between paying money to settle the case and risking a trial [HUD v. Escatawpa Village Associates, L.P., February 2012].

Coach’s Tip: For seven rules on complying with domestic violence laws, see “Dealing with Domestic Violence: How to Avoid Fair Housing and Other Legal Traps.”


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December 2021 Coach's Quiz