Which type of rental property is exempt from the federal Fair Housing Act?

The correct response highlights a specific exemption detailed in the Fair Housing Act regarding small rental properties. When a property consists of one to four units, the owner may be exempt from the federal Fair Housing Act under certain conditions. Specifically, if the owner is renting out a single-family home without using a broker and does not own multiple such properties, they can sometimes be exempt from complying with the regulations outlined in the Fair Housing Act.

This exemption is rooted in the desire to allow small property owners some degree of flexibility which is not typically afforded to larger landlords or those involved in larger multi-family housing operations. In contrast, properties with five or more units are always under the purview of the Fair Housing Act and are not exempt due to the increased scale and impact they have on the housing market.

Understanding these distinctions is crucial for navigating the complexities of fair housing regulations and recognizing when an owner has a responsibility to adhere to the Fair Housing Act.