5,320Units Under Management
Less Than 1% Eviction Rate
Avg. Time Rental Is on Market 23 Days

What is the Housing Justice Act and What Does it Mean for Landlords?

what-is-housing-justice-act

Although communities throughout Maryland have faced a shortage of affordable housing for some time, the COVID pandemic only exacerbated the situation. In response, Montgomery County Council members Evan Glass and Sidney Katz introduced the Housing Justice Act. Thus, creating more opportunities to combat housing discrimination and open doorways for individuals and families alike. For landlords, this new legislation will affect critical applicant screening criteria. So, continue reading below as we discuss everything rental owners need to know about the Housing Justice Act.

What is the Housing Justice Act?

In December of 2020, Councilmembers introduced the Housing Justice Act to strengthen the current housing discrimination laws. Furthermore, this law would further advance the county’s commitment to racial equity and social justice in the housing industry. In particular, residents transitioning from homelessness face housing practices rooted in systemic racism, according to Councilmember Sidney Katz. That said, the Housing Justice Act will help balance the power between landlords and prospective tenants by ensuring clarity and fairness across screening policies.

What is the Housing Justice Act?

According to lawmakers, the current laws aimed at providing fair housing are not specific enough in some of their requirements. For example, most landlords have screening criteria for proof of income, credit history, criminal background, and rental verification. That said, the existing law does not require landlords to disclose why they choose to deny an application. In addition, landlords do not have to disclose the following on their application –

  • Which criminal offenses constitute a denial
  • Specific credit history requirements
  • Rental fees

Council members believe that this lack of transparency could conceal discrimination based on protected Fair Housing classes such as race, ethnicity, or source of income – as well as a criminal history that “resulted from life-sustaining activities undertaken during periods of homelessness.”

On April 20, 2021, lawmakers unanimously approved the Housing Justice Act, which further guarantees all applicants an equal chance at suitable housing opportunities.

What Does the Housing Justice Act Mean for Landlords?What Does the Housing Justice Act Mean for Landlords?

The COVID pandemic has only made inequities in the housing industry worse. Montgomery County’s Housing Justice Act moves to demolish some of the policies rooted in systemic racism and instead help empower residents who have experienced homelessness. In addition, this will protect individuals who were arrested for minor offenses or who have completed their sentence against housing discrimination.

So, how will this change rental applications and screening processes for landlords?

To be clear, the Housing Justice Act does not prohibit landlords from screening applicants based on standard criteria. Instead, the law focuses on how landlords communicate the standards used to make a determination and what landlords can do with the information discovered. So, if you own rental property in Montgomery County, here are the changes you must be aware of.

Landlord Requirements Under the Housing Justice Act

  1. Rental applications must include all criminal and credit history requirements.
  2. Determine rental rates based on market demand and not on any discriminatory factors such as the source of income.
  3. Landlords may not run criminal background checks on prospective applicants until after making a conditional housing offer.
  4. Prohibits rental owners from inquiring or making a denial decision based on certain arrests, non-violent crimes, or low-level misdemeanor offenses.
  5. A landlord cannot deny an applicant based on any arrest where there was not a conviction.

What is Considered a Non-Violent Crimes Under the Housing Justice Act?

  • Trespassing
  • Public Urination
  • Marijuana Possession
  • Refusing to Leave a Public Building
  • Misdemeanor Theft
  • Other Minor Crimes
  • Indecent Exposure

Because this legislation focuses in part on disparities in the homeless community, indecent exposure is also considered a minor crime. Those who have ever been a part of the homeless community may have needed to change clothes or relieve themselves in public. Thus, increasing their chances of arrest for indecent exposure, despite their life circumstances. However, the law does allow landlords to evaluate more severe convictions. For example, if the indecent exposure relates to a more serious sex offense, including one that requires the tenant to register as a sex offender.

Are There Any Exclusions from the New Legislation?

Yes! Although the new legislation applies to all categories of rental units, there are a few specific exceptions. For landlords that fall into one of the categories below, exceptions to the Housing Justice Act may apply.

  1. Housing that the landlord also occupies
  2. Properties rented by religious organizations
  3. Accessory dwelling units

Understanding Existing Fair Housing Laws

In the rental industry, there are already many laws that protect tenants from housing discrimination. That said, as new legislation passes into law, landlords must ensure they adhere to existing laws as well as the new ones. This includes all federal, state, and local Fair Housing Laws.

Understanding Existing Fair Housing Laws

The federal Fair Housing Act ensures individuals and families in protected classes do not experience housing discrimination. These laws also protect tenants in one of the protected classes from harassment, retaliatory behavior, or exclusionary marketing. In addition, Federal Fair Housing Act protects persons from discrimination based on race, color, sex, religion, disability, familial status, and national origin.

It is important to note that protected classes may vary by location and include more than federal law. Some additional examples of protected classes include citizenship, age, veteran status, genetic makeup, sexual orientation, gender identity or expression, criminal history, and source of income. So, always check the local law where the property is located. While it is vital to understand the law and guidelines, the best defense against discrimination claims is to treat every tenant respectfully. When landlords hold all persons to the same standards, they significantly reduce the risk of committing any discrimination, either real or implied.

The Easiest Way to Keep Your Rental Legally Compliant

Following all applicable rental laws can be overwhelming for novice or even experienced landlords. Not to mention, regulations and legislation are constantly evolving. However, failing to follow laws can result in fines, loss of rental license, or costly litigation. So, for rental owners looking to ensure compliance, hiring a qualified property manager is the way to go.

Bay Property Management Group is the area’s leading third-party management firm. Our team of industry professionals is ingrained in the local community and helps owners get the most potential from their investment. Partnering with BMG offers owners access to targeted marketing, accounting services, online rent collection, and Owner Portal, lease drafting, and professional maintenance coordination. In addition, your dedicated property manager ensures the property remains legally compliant. If you are interested in learning more about our property management services, give us a call today.