You will definitely need to know fair housing basics for the Real Estate License Exam. The basic concept and goal of fair housing laws at the federal, state, and local levels is to prevent discrimination in housing and permit people to have an equal opportunity to live where they want to live.
Federal fair housing laws
Real estate agents primarily deal with and apply federal fair housing laws throughout the United States. Here’s some information on several federal laws, that you’ll need to know for the exam.
The 1866 Civil Rights Act
In 1866, right after the end of the Civil War, the United States Congress passed the Civil Rights Act of 1866. This law essentially prohibits discrimination in the purchase, sale, lease or conveyance of real property on the basis of race or color.
The language of the act is clear insofar as it basically says that without any exception whatsoever, all citizens shall have the same rights regarding property regardless of race. The other unique thing about this act is that enforcement is accomplished by taking the case directly to federal court.
Although the act itself is important, an almost equally important 1968 court case that involved the act resulted in a landmark decision in fair housing law that you should remember. The case, Jones versus Alfred H. Mayer Company, essentially affirmed the fact that the 1866 act prohibited any discrimination on the basis of race by private individuals and the government with no exceptions.
The lack of any exceptions to the 1866 Act is important, because more recent fair housing laws actually include exceptions. Because it was enacted first and still remains on the books, the 1866 act is deemed valid even today, having been affirmed in the Jones versus Mayer case as superseding later laws. Because of that, no exceptions exist with respect to racial discrimination in housing.
The 1968 Fair Housing Act
The Fair Housing Act of 1968 is more technically known as Title VIII of the Civil Rights Act of 1968. This act, the first in the 20th century, prohibited certain actions that were viewed as discriminatory with respect to housing and specifically defined groups, called protected classes, to which it applied. Unlike the 1866 Civil Rights Act, it included specific exceptions.
Together with the 1866 Civil Rights Act, the Housing and Community Development Act of 1974, and the Fair Housing Amendments Act of 1988, which added even more protected classes to the list, the 1968 act forms the basis of fair housing standards as they apply to real estate agents throughout the United States. The 1968 act is enforced by the Department of Housing and Urban Development (HUD).
These laws are best understood when they’re broken down into what you can’t do, who you can’t do it to, and exceptions to the law.
The current protected classes under the federal law can be remembered with the acronym FRESH CORN, which stands for:
Familial
Race
Equal
Sex
Handicap
Color
Opportunity
Race
National origin
Research state and local laws
State and local governments like counties and cities have gradually adopted their own fair housing laws. These local laws need to be viewed and obeyed in addition to and not instead of federal law. The general rule regarding situations in which federal and local laws cover the same issues is that the more restrictive or stricter law applies.
Local provisions usually don’t add prohibited activities; federal law is pretty comprehensive with respect to prohibited discriminatory practices. Local provisions that are sometimes added include additional protected classes, or groups that require relief under the fair housing laws. For example, several states have added sexual orientation as a protected class to their fair housing laws. In addition, exceptions that the federal law permits sometimes are removed at the local level.
Megan’s Law is a federally enacted law that promotes registration of convicted sex offenders after they’re released from prison and take up residence in a neighborhood. Megan’s Law has raised issues of the civil rights and rights to privacy of offenders in local jurisdictions. So you need to check with your state to determine your obligations.
For exam purposes and, of course, for purposes of your future real estate practice, you need to research and find out as much as you can about any local, state, or municipal laws that supplement federal fair housing laws. Pay careful attention to any additional prohibited acts, additional protected classes, and exceptions to the exceptions.
The fair housing poster
The Department of Housing and Urban Development (HUD) has created a fair housing poster that must be prominently displayed in all real estate offices. Failure to display the sign can be considered noncompliance with fair housing law and will be used as evidence of discrimination whenever a complaint is brought. HUD also requires that its fair housing logo or other such appropriate wording be used in all advertising.