Landlord Tips: Occupancy Limits 101

by Chris on July 2, 2018

A landlord in Alabama is facing a legal battle after refusing to rent a three-bedroom, single-family home to a mother with three children. The case highlights the need for landlords to understand today’s rules regarding occupancy limits.

These discrimination lawsuits are costly, and those costs grows exponentially when the landlord has rejected several rental applicants illegally.

The confusion appears to stem from a misconception that occupancy restrictions can be based solely on the number of bedrooms. While it is common to see limits based on one or two persons per bedroom, that “bedroom” rule is not the applicable legal standard when renting to families.

The guidelines for occupancy limits under the Fair Housing Act have been modified to accommodate larger families, which tend to experience the most hardship finding rental housing.

Landlords should not adopt a blanket policy for determining occupancy limits like counting the number of bedrooms. Unfortunately, there is no universal formula when it comes to discrimination against families. The appropriate factors to consider when deciding if a family is “too big” for a rental property include:

The overall square footage of the unit and common areas;
The layout of the rental property, including whether other rooms or areas — bonus rooms, offices, lofts — are suitable for sleeping;
The age of the children;
Local fire, building safety and zoning ordinances. This can include septic or sewer, plumbing and other building system issues. However, these standards are persuasive only, and do not provide landlords with justification to reject families; and
State statutes, city ordinances, and HOA bylaws, although these also are persuasive only, and can be challenged if the overall impact is to limit families.

Rejecting families due to the specific number of children or the gender of those children is likely discriminatory.

It is also problematic to restrict access to certain areas of the property, implement curfews on children, mandate supervision or steer families with children into specific units or floors.

If a discrimination claim arises, a landlord’s best defense is to show a process of deliberation when deciding to reject a family for occupancy limits. Be prepared to show the rationale behind the decision, including the specific factors considered.

This post is provided by Tenant Verification Service, Inc., helping landlords reduce the risks of renting with fraud prevention tools that include Tenant Screening, Tenant Background Checks, (U.S. and Canada), as well as Criminal Background Checks, and Eviction Reports (U.S. only).

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Disclaimer: The information provided in this post is not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.

{ 1 comment… read it below or add one }

McLane July 3, 2018 at 7:48 am

Is it legal to discriminate against people that are not families? We have a local ordinance where houses are licensed for a specific number of people regardless of the square footage of the home or the number of bedrooms. This limit only applies to non-related people. For example, a house may have 6 bedrooms but only licensed for 4 unrelated tenants or a ‘family’. A family of 8 could rent the home with no issue with the city.

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