4.3 Fair Housing in South Dakota
Key Takeaways
- Federal fair housing rests on the Civil Rights Act of 1866 (race, no exemptions) and the Fair Housing Act (Title VIII, 1968, as amended) with seven protected classes: race, color, religion, sex, national origin, disability, and familial status.
- South Dakota's Human Relations Act of 1972 (SDCL Chapter 20-13) bars discriminatory housing practices and adds creed and ancestry to the protected list, enforced by the SD Division of Human Rights.
- Prohibited conduct includes steering, blockbusting, redlining, refusing to deal, and discriminatory advertising — all are license-law violations as well as civil-rights violations.
- Disability protections require reasonable accommodations and reasonable modifications, and the Mrs. Murphy and 55+ housing exemptions are narrow and never excuse race discrimination.
- A South Dakota fair-housing complaint may go to HUD, the SD Division of Human Rights, or court, and SDREC can independently discipline the licensee's license.
The Two Layers of Fair Housing Law
Every South Dakota licensee works under two overlapping fair-housing regimes — federal and state — and must obey the stricter of the two whenever they differ.
Federal Law
| Statute | Protects | Key feature |
|---|---|---|
| Civil Rights Act of 1866 | Race only | Absolute — no exemptions; bars all racial discrimination in property |
| Fair Housing Act of 1968 (Title VIII), as amended 1988 | Seven classes (below) | Allows narrow exemptions; enforced by HUD |
The federal Fair Housing Act protects seven classes, recalled with the mnemonic R-C-R-N-S-D-F:
- Race
- Color
- Religion
- National origin
- Sex (including gender identity and sexual orientation under current HUD enforcement)
- Disability (handicap)
- Familial status (households with children under 18, and pregnant persons)
Exam trap: The 1866 Act covers only race, but it has no exemptions at all — so a racially motivated refusal that might escape the Fair Housing Act's small-landlord exemption is still illegal under the 1866 Act. Race is the one class with airtight, exemption-free protection.
South Dakota Law
South Dakota's Human Relations Act of 1972, codified at SDCL Chapter 20-13, makes it an unfair or discriminatory practice to refuse to sell, rent, lease, or otherwise transfer housing because of a protected characteristic. South Dakota's list adds creed and ancestry to the federal classes, so under state law the protected characteristics are:
race, color, creed, religion, sex, ancestry, disability, national origin, and familial status.
Enforcement runs through the South Dakota Division of Human Rights (within the Department of Labor and Regulation). Because state law reaches at least as far as federal law and adds classes, a licensee in South Dakota must honor the broader state list.
Prohibited Practices
The exam expects you to spot the named violations in a fact pattern. Memorize these terms:
| Practice | What it is | Example |
|---|---|---|
| Steering | Channeling buyers toward or away from areas based on a protected class | "You'd be happier in a neighborhood with families like yours" |
| Blockbusting (panic peddling) | Inducing sales by claiming protected-class members are moving in | "Sell now before values drop" |
| Redlining | Denying loans or insurance based on the area's demographics | A lender refusing mortgages in a minority ZIP code |
| Refusal to deal | Declining to show, sell, or negotiate based on a protected class | Telling a caller a listed home is "already sold" because of their accent |
| Discriminatory advertising | Ads stating a preference or limitation | "Adult building, no children" |
| Different terms/services | Varying price, terms, or service quality by class | Quoting a higher deposit to one class |
Key point: A licensee may never answer a steering-style question by describing a neighborhood's racial, religious, or ethnic makeup. The correct response directs the client to objective sources (school district data, crime statistics, demographic figures available publicly) and lets the client decide.
Disability: Accommodations and Modifications
Disability protection has two distinct duties that the exam loves to contrast:
| Duty | Who pays | Example |
|---|---|---|
| Reasonable accommodation | Landlord (policy change, no cost issue) | Waiving a no-pets rule for a service or assistance animal |
| Reasonable modification | Tenant (physical change) | Tenant pays to install a wheelchair ramp; may restore at move-out in a rental |
A housing provider may not charge a pet deposit for a verified assistance animal, because it is not a pet. New multifamily construction (four or more units, first occupied after March 1991) must also meet federal accessibility design standards.
The Narrow Exemptions
The Fair Housing Act allows a few exemptions — but they are tightly limited and never cover race or discriminatory advertising:
| Exemption | Conditions |
|---|---|
| "Mrs. Murphy" | Owner-occupied building of 4 units or fewer |
| Single-family by owner | Sold/rented without a broker and without discriminatory ads, owner owns 3 or fewer homes |
| 55+ / older-persons housing | Qualifying senior housing may exclude familial status (children) |
| Religious/private clubs | Limited preference to members, non-commercially |
Exam trap: The moment a real estate licensee is involved, the broker exemption evaporates — a licensee must comply fully even if the owner could have self-dealt under an exemption. And no exemption ever permits race discrimination (1866 Act) or a discriminatory advertisement.
Filing a Complaint
A person who believes they faced housing discrimination in South Dakota has several routes, and SDREC adds a fourth:
| Forum | Role |
|---|---|
| HUD | Federal Fair Housing Act complaint (generally within 1 year) |
| SD Division of Human Rights | State Human Relations Act complaint |
| Federal court | Civil suit (generally within 2 years) |
| SDREC | Disciplines the license independently of the civil claim |
Worked example: A broker associate tells a family with three children that a vacant unit is unavailable, then rents it the next day to a childless couple. That is familial-status discrimination. The family can complain to HUD or the SD Division of Human Rights, and SDREC can separately suspend or revoke the licensee's license — the civil remedy and the license discipline are independent tracks.
Which protected characteristics does South Dakota's Human Relations Act add beyond the seven federal Fair Housing Act classes?
A prospective buyer asks a licensee, 'What is the racial makeup of this neighborhood?' What is the licensee's correct response?
A tenant who uses a wheelchair asks to install a grab bar and ramp at the tenant's own expense. Under fair housing law, this is a:
Which fair-housing protection has NO exemptions whatsoever?