13.4 Federal Fair Housing Act, ADA Obligations & Fair Housing Advertising

The Statutory Layers

Fair housing in New Jersey is built in strata, and a broker must be able to name each one.

Jones v. Alfred H. Mayer Co. (1968) confirmed that the 1866 Act reaches purely private racial discrimination. That is why the exam answer to "which protected class has no exemption?" is always race.

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The Seven Federal Protected Classes

1. Race
2. Color
3. Religion
4. National origin
5. Sex — HUD administers this to include sexual orientation and gender identity, following the reasoning of Bostock v. Clayton County (2020); sexual harassment in housing is also a sex-discrimination violation
6. Familial status — households with a child under 18, pregnant persons, and those securing legal custody. The narrow exception is housing for older persons: 100% occupied by persons 62 or older, or 80% of units occupied by at least one person 55 or older with published intent and verification.
7. Disability (handicap) — a physical or mental impairment substantially limiting a major life activity, a record of such impairment, or being regarded as having one. Current illegal drug use is excluded; a person in recovery is protected. Alcoholism is a protected disability.

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The Four Prohibited Practices

• Blockbusting (panic peddling) — inducing a sale or rental by representing that persons of a protected class are entering the neighborhood. New Jersey addresses this directly at N.J.A.C. 11:5-7.4(a) and adds a recordkeeping trigger at 7.4(b): a broker who solicits three or more residential properties on the same block within a month in personal meetings must keep a permanent record for at least one year of who was solicited, by whom, at what address, and when, available to the Commission on request.
• Steering — directing prospects toward or away from areas based on a protected characteristic. Steering is usually well-intentioned in the licensee's own mind, which is exactly why it must be trained out. Answer "which neighborhood would be right for my family?" with objective data sources and school-district reference tools, never with a characterization of who lives there.
• Redlining — refusal to lend, insure, or appraise in an area based on protected characteristics of its residents. Brokers commit a version of it by declining to service a geographic area on that basis.
• Disparate treatment — treating an applicant differently: different qualification standards, quoting different terms, or misrepresenting availability.

Disparate impact liability reaches a facially neutral policy that disproportionately excludes a protected class — a blanket refusal to rent to anyone with any criminal record, or a minimum-income rule applied to the whole rent rather than a voucher holder's actual share. HUD's 2013 discriminatory-effects rule provides the burden-shifting framework, and Texas Department of Housing v. Inclusive Communities Project (2015) confirmed the theory's availability under the Act.

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Disability: Accommodations, Modifications, and Design

Two remedies with different payers, and the exam tests the split relentlessly.

Assistance animals are not pets. No pet deposit or pet rent may be charged. A provider may request reliable documentation of a disability-related need where the disability is not readily apparent, but may not demand a diagnosis, medical records, or specific training credentials for the animal.

Design and construction. Buildings with four or more units first occupied after March 13, 1991 must meet seven requirements: an accessible building entrance on an accessible route; accessible public and common-use areas; doors usable by a wheelchair user; an accessible route into and through the dwelling; light switches, outlets, and thermostats in accessible locations; reinforced bathroom walls for later grab bar installation; and usable kitchens and bathrooms with wheelchair maneuvering space.

The ADA. Title III reaches public accommodations and commercial facilities. A brokerage office open to the public, a leasing office, a model home used as a sales office, and a community clubhouse are covered. Barrier removal is required where readily achievable. Residential dwelling units themselves are generally governed by the FHA rather than the ADA, but the sales and rental offices serving them are not.

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Advertising and the Narrow Federal Exemptions

Advertising. Section 804(c) prohibits any notice, statement, or advertisement indicating a preference, limitation, or discrimination. Liability is not limited to licensees — publishers and platforms are reachable. Describe the property, never the people: "four bedrooms, fenced yard, walk to the station" is safe; "perfect for a young Christian family," "no children," "ideal bachelor pad," "walking distance to St. Anne's" is not. Photographs and social media imagery that consistently depict only one group can themselves indicate a preference.

Exemptions — and why a licensee can almost never use one.

1. Single-family home sold or rented by owner, where the owner owns no more than three such homes, uses no broker, and publishes no discriminatory advertising.
2. Owner-occupied building of up to four units (the "Mrs. Murphy" exemption).
3. Religious organizations and private clubs limiting non-commercial housing to members, where membership is not restricted by race, color, or national origin.
4. Housing for older persons as to familial status only.

Three limits collapse these in practice: no exemption applies to race under the 1866 Act; no exemption survives the use of discriminatory advertising; and no exemption applies where a real estate licensee is involved in the transaction. A licensee therefore never has a fair housing exemption to rely on. New Jersey's LAD narrows the exemptions further, as Section 13.5 explains.

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Enforcement and Penalties

A complaint may be filed with HUD within one year of the discriminatory act, or a civil action brought in federal court within two years. HUD investigates, attempts conciliation, and may issue a charge; the case is then heard by an administrative law judge unless a party elects federal court. Remedies include actual and punitive damages, injunctive relief, and attorney's fees. Civil penalties in HUD administrative proceedings run in tiers that escalate for repeat violators, and the Department of Justice may bring pattern-or-practice actions.

For a New Jersey licensee the exposure is compounding: a fair housing violation supports a HUD or Division on Civil Rights proceeding, a private damages suit, and independent Commission discipline under N.J.S.A. 45:15-17 up to and including revocation.