Can a Landlord reject potential tenants if the rental properties septic system can only handle 3 people and they have more?
Can a Landlord reject potential tenants if the rental properties septic system can only handle 3 people and they have more?
Question
I am renting a duplex that has two bedrooms and an office. It is on a septic system and cannot handle more than three persons living in the house. I am in the process of advertising and screening tenants and want to know if it is allowable to reject a tenant based on the number of persons, including children, that exceeds three people?
Answer
Occupancy issues can be risky because there can be different definitions and standards at federal, state, or local levels. Various standards in use include number of bedrooms and unit area. However, the floor plan and other issues must be taken into account. For example, absent some physical limitation, a 2-bedroom and office unit may be considered adequate for a half-dozen occupants, possibly even more depending on other issues regarding the floor plan.
However, one of the safest reasons for having a maximum occupancy limit is when some physical issue limits the number of occupants even though the size, number of rooms, and floor plan do not. The capacity of water and septic systems will generally be in this category.
In order to avoid any claims regarding fair housing law violations, it is important to avoid any indication that protected classes are being discriminated against. Protected classes sometimes vary among federal, state, and local jurisdictions, with number of classes and degrees of protection increasing as level of government decreases.
I would strongly recommend that you have some written documentation from an independent qualified expert providing his professional opinion that a maximum of 3 occupants should be allowed. Preferably, this would be one that is licensed by your state regarding septic systems. Otherwise, considering the number of rooms in the unit you may well have trouble defending against a claim that you are in violation of federal fair housing laws, especially the protected class of “familial status,” although I can imagine other federal protected classes that could potentially be used against you. A fair housing law investigator is unlikely to believe that a septic system of such limited capacity was installed for a duplex unit having
at least one unit with two bedrooms and an office room. The costs of defending yourself and the potential financial and other penalties if unsuccessful would have easily paid for installation of several additional septic systems or one
very large one.
You don’t include details about the entire duplex building, so it might be that the septic originally served a smaller building that has since been modified into a duplex. In this case there might be zoning and/or code violations that could cause additional costly problems if the matter gets out of hand.
Notwithstanding the fair housing issue there is another issue you might want to consider – rating the capacity of the subject septic system below actual capacity. In doing so you would almost certainly limit the size of your potential pool of qualified applicants. Even limiting occupants to 3 rather than 4 has a significant potential impact on number of applicants. Three occupants allow 3 adults or 2 adults & 1 child or 1 adult & 2 children. This disallows 2 parents and 2 children, a common family size, possibly a larger class of applicants than any of the permitted ones, as well as 1 adult & 3 children. Even if each class of occupant groups is of the same size, you will potentially be reducing your pool of qualified applicants by 40 percent if you can’t allow 4 occupants. Fewer qualified applicants usually results in longer vacancies or lowering of qualifying standards.