Chapter 21 – Leases

The 15th Edition of Modern Real Estate Practice in Texas was published in November 2011.  Updates to the content of Chapter 21 include: 

Americans with Disabilities Act and Pool Accessibility:  New rules went into effect on January 31, 2013, that may require some pool owners under specific circumstances to install permanent, fixed lifts to improve accessibility under the ADA.  While most apartment firms will remain unaffected by the new requirements, some will have to comply if they allow people beyond private residents and guests to use the apartment communities’ pools.  Pools fall outside the ADA requirements if they are for the exclusive use of residents and their guests.  (National Apartment Association. “New ADA Pool Accessibility Standards in Effect Jan. 31,” Units, March 2013.)

Fair Housing/Lending Law: In February 2013, HUD issued a final rule clarifying the circumstances under which certain housing practices may violate the Fair Housing Act as a result of a discriminatory effect. Referred to as the disparate impact rule, this directive explains the longstanding prohibition of practices that have a discriminatory effect even where there may not be evidence of discriminatory intent.  A practice is considered discriminatory under the act if it “actually or predictably results in a disparate impact on a group of persons or creates, increases, reinforces, or perpetuates segregated housing patterns because of race, color, religion, sex, handicap, familial status, or national origin.”  (Ari Karen. “Viewpoint: HUD Imposes New Discrimination Standards,” Origination News, March 2013.)

“Under the law, as clarified by the new rule, when a practice results in the denial of a service (e.g., refusing to rent an apartment or approve a mortgage loan) or unfavorable terms and conditions under which that service is available to members of protected classes, it would violate the Fair Housing Act if it did not serve a substantial, legitimate, and nondiscriminatory interest. If the practice did serve such a purpose but the complainant can show a less discriminatory alternative is available that would equally serve that purpose, the practice in question would also violate the law.  However, the rule also makes clear that those practices having a negative impact on racial minorities and other protected classes are fully in compliance if they serve a significant business objective and no less discriminatory alternative is available to serve that interest.” (Gregory D. Squires. “HUD’s Disparate Impact Rule Praised by Fair Housing Advocates: Misunderstood by Critics,” Huffington Post.com, February 24, 2013.)

Sexual Orientation and Gender IdentityEffective March 5, 2012, HUD prohibits owners and operators of HUD-assisted or HUD/FHA-insured housing from asking about an applicant’s or occupant’s sexual orientation and gender identity for the purpose of determining eligibility or otherwise making housing available.  [National Apartment Association. “Political Insider: HUD Issues New Gender and Sexual Orientation Protections,” Units, March 2012.]

HUD.gov provides this explanation regarding LGBT discrimination (April 2013):  [http://portal.hud.gov/hudportal/HUD?src=/program_offices/fair_housing_equal_opp/LGBT_Housing_Discrimination]

“The federal Fair Housing Act prohibits housing discrimination based on race, color, national origin, religion, sex, disability, and familial status (i.e., presence of children in the household). The Fair Housing Act does not specifically include sexual orientation and gender identity as prohibited bases.  However, a lesbian, gay, bisexual, or transgender (LGBT) person’s experience with sexual orientation or gender identity housing discrimination may still be covered by the Fair Housing Act.  In addition, housing providers that receive HUD funding, have loans insured by the Federal Housing Administration (FHA), as well as lenders insured by FHA, may be subject to HUD program regulations intended to ensure equal access of LGBT persons.

Examples:

  • A gay man is evicted because his landlord believes he will infect other tenants with HIV/AIDS.  That situation may constitute illegal disability discrimination under the Fair Housing Act because the man is perceived to have a disability, HIV/AIDS.
  • A property manager refuses to rent an apartment to a prospective tenant who is transgender.  If the housing denial is because of the prospective tenant’s non-conformity with gender stereotypes, it may constitute illegal discrimination on the basis of sex under the Fair Housing Act.
  • An underwriter for an FHA insured loan is reviewing an application where two male incomes are being used as the basis for the applicants’ credit worthiness. The underwriter assumes the applicants are a gay couple and, as a result, denies the application despite the applicants’ glowing credentials.  This scenario may violate HUD regulations which prohibit FHA-insured lenders from taking actual or perceived sexual orientation into consideration in determining adequacy of an applicant’s income.” 

The Fair Housing Act and Reasonable Accommodations for Hoarders:  “Hoarding is sometimes associated with mental illness and is soon slated to have its own formal diagnosis. . . Because hoarding has been associated with mental illness, owners/operators [of rental properties] should assume hoarding can qualify as a protected disability.” (John Sepehri, General Counsel for the Texas Apartment Association.  “The Fair Housing Act and Reasonable Accommodations for Hoarders.” Texas Apartment Association, Spring 2013.)

Smoke Alarms:  If a rental unit has multiple levels, there must be a smoke alarm on each level.

Eviction Rules; Proposed Changes: As the result of Texas court reform legislation passed in 2011 (H.B. 79), small claims courts have been consolidated with the justice courts.  New rules of procedure are being drafted by the Texas Supreme Court and are scheduled to take effect on May 1, 2013.  New rules can be found at http://www.texasbar.com/AM/Template.cfm?Section=Texas_Bar_Journal&Template=/CM/ContentDisplay.cfm&ContentID=21699

Updated:  April 15, 2013.

Information has been obtained from sources believed to be reliable. However, because of the possibility of human or mechanical error, the authors and editors do not guarantee the accuracy, adequacy, or completeness of any information and are not responsible for any errors or omissions or for the results obtained from use of such information. We assume no responsibility, express or implied, for errors or omissions of any kind, and no warranties of merchantability or fitness, express or implied, are made or to be implied, the product being accepted as is and with all faults. The information in this Website is not a final statement of the law on any given matter and does not substitute for experienced legal counsel.

© 2009 Cheryl Nance. All Rights Reserved.

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