Purchasing and owning single-family rental properties can be an enjoyable and rewarding investment. Unlike other types of investments, there are numerous factors to consider to successfully go from a property owner to a landlord. Suppose you are a Chesapeake rental property owner and are about to lease for the first time. In these circumstances, it is necessary that you fully understand the basics of leasing strategies and, even more importantly, the laws that now apply to you and your renter. We have compiled a comprehensive guide to get you started on leasing your first property. By obeying these simple guidelines, your first experience will be a pleasant one.
Renter Screening Process
One of the first and most important stages in leasing your rental property is selecting an ideal renter. And the way to achieve this is by implementing a good tenant screening process for each applicant. You will need to acquire information from your prospective renter to see whether they are the ones you’re hunting for. At a minimum, you should require them to fill out an application that includes all intended home occupants’ names and birth dates (even those under 18), five years of employment history, and at least three past rental references. You’ll also want to acquire Social Security numbers for all adult renters and run a background check on each one. Then, call and verify the information on their application. Ideally, contact any previous landlords and get details on their renting history. The more research you perform before you sign that lease, even if it takes a while, the less likely you are to experience negative outcomes in the future.
Avoiding Discrimination
As you advertise to and screen renters, it’s essential to prevent discriminating against potential renters, even by accident. Various federal laws make it illegal to discriminate against a renter based on race, sex, color, national origin, religion, handicap, and familial status. These laws include:
- Fair Housing Act (FHA): The Fair Housing Act (FHA) is a federal law that prohibits discrimination in housing according to race, color, national origin, religion, sex, familial status, or disability. The FHA manages all parts of the rental process, including advertising, tenant selection, and terms and conditions of tenancy.
- Americans with Disabilities Act (ADA): Also covered by FHA is a federal law that prohibits discrimination against individuals with disabilities. Landlords who own multi-unit buildings of 4 units or more are obligated to provide reasonable accommodations for persons with disabilities, like giving accessible parking spaces or placing grab bars in bathrooms.
- Age Discrimination in Employment Act (ADEA): The Age Discrimination in Employment Act (ADEA) is a federal law that forbids discrimination against individuals 40 years of age or older. Although the ADEA is primarily meant to protect employees, it also prevents discrimination in housing based on age.
- Equal Credit Opportunity Act (ECOA): The Equal Credit Opportunity Act (ECOA) is a federal law prohibiting discrimination in credit transactions, including rental transactions. Under the ECOA, landlords may not discriminate against individuals based on their race, color, national origin, religion, sex, marital status, age, or because they receive public assistance.
Apart from federal law, you need to research state and local law. There may be other protected classes depending on local regulations.
As you compose your rental ads, avoid using language that could be perceived as discrimination, such as claiming that you will not rent to seniors or people with children or that you won’t rent to those who live on government assistance. Then, when you collect applications and screen renters, fairly assess your applicants based on the information they provide and not on other criteria. By employing professionalism and using an unbiased screening system, you can stay clear of discriminating against any potential renters.
Understanding Reasonable Accommodations
Similarly, it is necessary not to assume that someone with a disability is always an unsuitable candidate for your rental property. Under the Federal Fair Housing Act, Chesapeake property managers are required to make “reasonable accommodations” for their renters, if required. By definition, a reasonable accommodation is “a change, exception, or adjustment to a rule, policy, practice, or service that may be necessary for a person with a disability to have an equal opportunity to use and enjoy a dwelling.” If your prospective renter otherwise meets the criteria for renting your property, accommodation should not be a reason to decline them. The accommodation a renter requests would be paid for and installed by the renter, with the premise that they will restore the property to its original condition upon move-out.
Other accommodations include permitting service and emotional support animals in the rental property, even if you have a strong policy against pets. Service and emotional support animals are excluded from a rental pet policy. You may not charge additional rent or fees if a renter has a service animal on the property.
It can be difficult to learn all the laws and best practices for leasing rental properties. Why not transfer this important task to a professional property manager? At Real Property Management Hampton Roads, we provide transparent and anti-discriminatory screening and leasing services to assist our rental property owners in identifying the best possible renters. Contact us today or call us at 757-395-4274 to learn more.
Originally published on June 4, 2021
We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.
