Why Targeted Marketing In Housing Is Not A Good Idea
Understandably, every landlord wants to maximize marketing efforts to find as many qualified tenants as possible. The most desired way to accomplish this goal is to collect demographic information from prospects who visit and show interest in their properties so that they can later directly advertise to that same demographic. In other words: if most of the people who show interest in a property are young adults without children, it may be tempting to directly target marketing towards similarly situated young adults without children. While, on the surface, this marketing plan may seem reasonable, harmless, and fail proof, it is a bad idea and could result in liability for landlords.
Under the Fair Housing Act (“FHA”), it is unlawful to discriminate against anyone based on their membership in a protected class. Under federal law, the protected classes are: race, color, religion, sex, handicap, familial status, and national origin. Various states have included additional protected classes, such as age, sexual orientation, veteran status, and personal appearance (to name a few).
Contrary to popular belief, targeted marketing may be discriminatory under the FHA because it is unlawful to make, print, or publish any notice, statement, or advertisement that indicates any preference, limitation, or discrimination because of race, color, religion, sex, handicap, familial status, national origin, or any other protected class. The law also prohibits the selective use of advertisements, such as strategically placing billboards or distributing brochures within limited geographic areas, and advertising in mediums known to reach a very particular demographic of the community.
Practically speaking, if a landlord is collecting or making note of its tenants’ protected class demographics (e.g., familial status— “50% of our prospective tenants are young adults without children!”) to tailor its advertising efforts (e.g., “we need to market to all young adults without children!”), the landlord’s actions would likely run afoul of fair housing laws and, to their further detriment, they are creating a clear record of their illegal collection efforts for anyone who may later investigate. When certain types of fair housing complaints are filed against a landlord, fair housing investigators often inquire about whether the landlord collects and/or keeps records of demographic information of prospects and residents. When a landlord can answer “no,” this greatly reduces the appearance of impropriety.
If a landlord wants to target market, the law does provide for a few exceptions. Namely, it is legally permissible to directly advertise the availability of accessible housing and advertise housing intended and operated for occupancy by older persons. Also, if the property receives state or federal housing funding, the landlord may be required to complete an affirmative fair housing marketing plan, in which a landlord could obtain approval to target certain demographics which are least likely to apply for housing at the property. However, if none of these exceptions apply, proceed with caution.
For additional information about fair housing laws impacting landlords, please contact us.
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