How the HOME Act Could Affect Landlords

In December, Delegate Stephen Lafferty, D-Baltimore County, said specifics for a 2017 version of his HOME Act legislation were in progress. Lafferty introduced the bill in the last legislative session of the Maryland General Assembly, but it did not move beyond the first hearing.

If the 2017 version is not substantially different from last year’s HOME Act, it would – if passed – require landlords to accept Housing Choice Vouchers. The bill would extend discrimination protection to people participating in the voucher program; landlords would be prohibited from refusing tenants based on their method of payment.

For Maryland landlords, the legislation could result in significant changes to how they conduct business. However, several Maryland jurisdictions already have local laws extending such discrimination protection to people participating in the voucher program, including Howard County.

How the Program Works

Formerly known as “Section 8,” the voucher program is federally funded, but is administered by state and local agencies. The program is intended to help elderly people, low-income families, and people with disabilities find safe and sanitary housing.

Once approved for the program, people can begin looking for rentals that accept program vouchers. When they find a suitable rental home, the state or local voucher program administrator must inspect the property to ensure it meets the federal government’s habitability requirements. If the rental home is approved, the tenants will pay 30 percent of their adjusted monthly gross income toward rent and utilities, and government funds cover the difference.

Concerns for Landlords

The process of inspecting and approving a property for the voucher program takes time, which could mean landlords will have to wait longer than they’d like to receive the first rent payment. Some landlords may also worry that tenants using vouchers care less about taking good care of the rental unit, because they’re paying relatively little, compared to other tenants.

The voucher program requires annual inspections of units where program participants live, which may pose an inconvenience to landlords. And in those units, the government prohibits you from raising the rent beyond the median rent price in your vicinity. That could mean a loss in potential rental income. However, there may be some benefits for landlords participating in the voucher program.

Possible Perks

The process of finding a place to live and waiting for the inspection is inconvenient for tenants, so once they settle into a rental, they’re likely to stay there more than a year. Landlords may find that renting to voucher-users reduces vacancy rates.

Non-payment of rent is one of the biggest headaches associated with property management. But through the voucher program, landlords are guaranteed to receive at least a portion of their rent, even if tenants stop paying.

Other Concerns

Should the HOME Act pass this year, landlords will need to review their current practices to ensure they’re in compliance. For example, landlords already know they can’t ask applicants questions about their race or religion, but rental applications and leases may contain wording that could be deemed discriminatory toward voucher-users, which would be illegal under the new law.

An experienced business attorney can review contracts and revise them, if necessary, to protect landlords from litigation.

Lusk Law, LLC, specializes in assisting landlords, helping them prepare official documents and prepare for regulatory changes. Our experienced attorneys have provided legal counsel and representation to landlords in Frederick County, Howard County, Baltimore County, Baltimore City, Carroll County, Washington County, and Anne Arundel County, and other counties in Maryland. Please call us at 443-535-9715 or fill out our contact form if you have any questions about this topic.

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