Fair housing laws in California start with the federal Fair Housing Act. But our state laws go even further. Anyone investing in California rental real estate needs to have a detailed understanding of fair housing laws, which are in place to protect tenants and applicants against discrimination of any kind.
We know it can be difficult to keep up with all of the ever-changing laws. Fair housing laws are especially prone to regular updates, additions, and new interpretations. For example, service animals and support animals have been hot topics lately. In some California cities, criminal backgrounds cannot be checked until after a tenant has been approved for a property.
Any rental property owner or real estate investor who is new to California markets or unsure of what fair housing laws mean for their properties should contact us. At Bell Properties, we’re careful to stay up to date on all the latest laws and the application of those laws. We can keep owners compliant and out of legal danger. Making a mistake is easier than most investors think.
Here’s a snapshot of what every investor needs to know about fair housing laws.
Protected Classes in California
California stands out as one of the most progressive states in the nation when it comes to tenant protections, offering broader and stricter support than those provided under the federal Fair Housing Act (FHA).
Federal Fair Housing Act: The Foundation
The federal Fair Housing Act, passed in 1968 and amended over the years, prohibits housing discrimination based on seven protected classes:
Race
Color
National Origin
Religion
Sex (interpreted to include gender identity and sexual orientation since a 2021 HUD directive)
Familial Status (e.g., families with children under 18)
Disability
These protections apply to anyone who is renting, buying, and financing housing. Landlords, real estate agents, mortgage lenders, insurance agents, and others involved in housing transactions are legally prohibited from denying housing or offering different terms based on any of these characteristics.
California's Fair Housing Laws: Broader and Stricter
California’s main anti-discrimination housing law, the Fair Employment and Housing Act (FEHA), enforced by the California Civil Rights Department (formerly DFEH), builds upon and expands the protections provided by these federal protections. In addition to the FHA’s seven protected classes, California includes a wide array of other characteristics, making it one of the most inclusive states in the nation.
Additional protected classes under California law include:
Sexual Orientation
Gender Identity and Gender Expression
Marital Status
Ancestry
Source of Income (including housing vouchers like Section 8)
Primary Language
Citizenship and Immigration Status
Genetic Information
Military or Veteran Status
Age (particularly for people over 40)
Medical Condition (such as cancer or genetic characteristics)
Perceived Characteristics (e.g., if a landlord assumes someone is of a certain race or religion and discriminates based on that assumption)
Additionally, California law prohibits discrimination based on arbitrary characteristics not explicitly listed, offering a broader net of protection. These nuances make professional property management so essential in California. Investors may make a mistake without even realizing it or intending to discriminate.
Enforcement and Remedies Pertaining to Fair Housing
Enforcement also differs between state and federal systems. In California, investors need to know that tenants can file complaints with the Civil Rights Department or sue directly in court. Remedies can include damages, punitive damages, and civil penalties. California law also imposes strict responsibilities on housing providers to provide reasonable accommodations for individuals with disabilities. This also goes beyond what’s typically required under federal law.
This matters to investors who are thinking about buying property here or who are already renting out homes. A practice that may be legally questionable under federal law could be outright illegal under state law. For example, rejecting a tenant solely because they use a housing voucher would not violate the FHA, but it is unlawful in California due to the protection of “source of income.”
California’s housing discrimination laws reflect the state’s commitment to inclusivity and equity. While the federal Fair Housing Act lays an essential foundation, California’s broader list of protected classes and stricter enforcement mechanisms provide greater safeguards for residents. Anyone involved in housing within the state must stay informed and compliant, not only to avoid legal liability but to support fair and equal access to housing for all.
Real estate investors who might be perplexed by the California protected classes are invited to contact us at Bell Properties. We can talk through any uncertainty.
Where Fair Housing Mistakes are Most Often Made: Marketing and Screening
As professional property managers, we see a lot of mistakes made with fair housing. Despite the legal protections in place, many California rental property owners unintentionally violate these laws, and if mistakes are going to be made, they’re most likely going to be made during marketing and tenant screening.
Marketing: Using the Wrong Words Has Risky Implications
Fair housing mistakes in marketing often stem from poorly chosen language in rental listings. What may seem like harmless phrasing can actually be considered discriminatory.
For example, saying a studio apartment is “perfect for a single professional” or “ideal for a quiet couple” might discourage families or larger households from applying, which could violate familial status protections. Phrases that target specific preferences like “English-speaking only” or “Christian household” are clear violations, regardless of intent.
Using images in marketing materials that do not reflect diverse demographics or imply preference can also be problematic. A rental flyer featuring only a certain ethnicity or age group might be viewed as subtly discouraging others from applying.
These are issues most investors and rental owners want to avoid. We always recommend that listings focus strictly on the property’s features, not the type of tenant the landlord thinks would be ideal. Statements like “2-bedroom unit near downtown, newly remodeled, $2,900/month, no smoking” are much safer and legally sound.
Screening: Don’t Allow Bias to Creep In
Once applicants begin to apply, the screening process becomes a minefield of potential fair housing violations, especially with recent state laws that require applications to be considered as they are submitted with an application fee. Owners can no longer collect a number of applications and then choose one that they like best. As soon as an application meets the standard rental criteria that’s been established, the lease offer has to be made.
Here are what some other common pitfalls look like:
Inconsistent application standards. Asking some applicants for extra documentation or using different credit or income standards depending on the applicant’s background is illegal. Every applicant must be screened using the exact same criteria.
Disability discrimination. California landlords sometimes reject applicants with service or emotional support animals, assuming their “no pets” policy gives them a legal out. It doesn’t. Support animals are not pets under the law and must be accommodated unless it creates an undue burden.
Familial status discrimination. Some landlords screen out applicants with children by citing occupancy limits that are too restrictive. In California, a common guideline is two persons per bedroom, plus one. Enforcing a stricter rule may constitute discrimination.
Assumptions about criminal background. Blanket bans on criminal history are risky. HUD has advised that such bans may disproportionately affect protected classes and should be narrowly tailored to relevant, recent offenses that pose a real threat.
Not sure about what’s okay and what’s not okay? Contact us at Bell Properties for help with marketing and screening and you’ll know that everything is legally sound. In the meantime, California landlords should use legally vetted rental applications and screening tools. Always remember to advertise based on the property’s merits, not personal assumptions.
Document all screening procedures and standards clearly and then apply them consistently. Investors need to understand reasonable accommodations and how to process them properly.
Avoiding these common marketing and screening mistakes not only protects landlords from legal exposure but also opens the door to a wider pool of qualified tenants.
Section 8 Tenants and Proof of Income
It is illegal for landlords in California to refuse to rent to someone based solely on their source of income. As of January 1, 2020, this explicitly includes housing choice vouchers (Section 8).
This means that landlords cannot advertise properties with phrases like "No Section 8" or deny an application because a tenant plans to pay rent using a voucher. Additionally, landlords must screen voucher holders like any other applicant, considering the portion of rent the tenant will pay and not the full market rent. For example, if the voucher covers 70% of the rent, only the remaining 30% should be considered when evaluating the tenant’s income.
However, landlords can still apply other neutral criteria such as credit history, rental references, and eviction history, as long as they do so consistently for all applicants. California’s protections aim to reduce housing discrimination and increase access to housing for low-income families. Violations can lead to complaints filed with the California Civil Rights Department (CRD).
There’s a lot to consider when it comes to fair housing and California residential rental properties. Don’t invite the danger, the chaos, and the cost of a fair housing mistake. Investors who are looking for some extra information and support can contact us at Bell Properties. We’d be happy to provide extra resources or to show you how we expertly manage your investments within the state and federal laws.
