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Corporate Housing By Owner (CHBO), has recently completed its 10th annual Corporate Housing Real Estate survey. For the first time, since the survey began, they are able to show definite trends in their specialized segment of the corporate housing industry.
If you are about to invest in corporate rentals and executive rentals, or you already own them and wish to be in full agreement with federal laws, you need to be aware of the Fair Housing Act. It is legislation dating back to 1968 and it “prohibits housing discrimination based on race, color, religion, national origin, sex, disability and familial status”. It applies to corporate rentals as much as it does to standard housing options, and that means you have to pay attention to it when listing and renting your executive rentals, too.
How would you have (inadvertently) violated the FHA in your corporate rentals or executive rentals? As one real estate report explains, “Fair Housing Act violations can occur in all phases of buying and renting, including in advertising, while you search, throughout the application process, in financing or credit checks, and during eviction proceedings.”
As someone who owns corporate rentals, you can violate it by suggesting a potential client look at a different property in a different location based on your feelings about their race, sex (and/or sexual orientation), disabilities, and so on. You might refuse to rent to someone or ask for a higher deposit based on some prejudices or inaccurate beliefs you hold. You might charge someone a higher rate based on their gender or their race.
There are many ways you might be in violation of it, and so it pays to know one key rule to help you avoid crossing the line and breaking the law when renting out your executive rentals: You must apply the same standards and extend the same terms to everyone who applies to rent a property.
In other words, if someone is disabled and wishes to rent the property, you need to make reasonable accommodations for that tenant. If someone is a different ethnicity than another applicant, you cannot give the second applicant preference over the other. Everyone must be given the same treatment.
Keep in mind that you might violate the FHA in advertising, screening, and many other ways. It is always in your best interest to be fully versed in the ways in which the FHA overlaps with your rental business. A good way to protect yourself is to be an exquisite record keeper, creating a fail-proof system that tracks everything from first contacts and applications to meetings and all the rest. This is one of the best ways to be sure you do not fail to meet the FHA standards and to prove nothing prejudicial or unfair was done during your interactions with renters or potential corporate or executive renters.
The results are in, so let’s dig deeper. Each week CHBO will analyze data from the annual corporate housing report and open a discussion. Please provide feedback with your experiences in 2017. This week we discuss how long our providers have been Corporate Housing landlords and why.
Property management, of corporate housing, by independent owners remains an emerging field. It’s a field that more owners are committing to, in order to achieve rental success. Consider that:
In last year’s annual report, we predicted that if interest rates remained stable in 2017, we should see a “possible increase in new investors who are willing to enter the real estate investment market.” Not surprising that prediction was correct. We saw new investors entering the corporate housing real estate market at a year over year increase of 5%, our highest increase ever.
Once again, the majority of respondents tell us they are landlords for investment purposes. This year at an all-time high of 60%. The “other reason we’re a landlord” category continues to be as “partial landlords.” We define “partial landlords” as property owners who have a fully functional, stand-alone guest house or apartment suite on the same site as their primary residence. Traditionally, this may have been referred to as an in-law apartment. (Please note, this is different than the “shared space” where property owners rent out a room within their residence, sharing the same space as their renter.)
To learn more about this topic and other results, view the CHBO annual report.
To view Historical Reports, visit here.
