Rule Changes for Tenant Screenings Worry Landlords

Across the country, access to affordable housing remains a pressing concern. Whether landlords create unfair barriers to housing remains a hot topic. Concerned about homelessness and high prices, local authorities increasingly act to expand housing access. That often means producing legislation that may directly affect how a landlord selects new tenants. Landlords claim these efforts harm their ability to operate safely and affordably. Advocates often argue that some landlords seek any excuse to deny tenants without appearing outwardly discriminatory.

A long-term battle over these issues originates from past and potential future regulations. At the heart of this fight are the background checks many landlords use to screen potential tenants. The city of Minneapolis, Minnesota, offers one such example. In 2019, the city council passed a sweeping ordinance to change the rental process. Objections from landlords softened some provisions, but the law was passed, implementing large-scale changes to tenant selection.

Primary among these changes were new limits on how landlords may use background checks, and new time limits were enforced. If a misdemeanor record is older than three years, landlords cannot consider it. The same three-year limit also applies to evictions. Felonies older than seven years aren’t admissible. Some more serious crimes, such as particular assaults, become inadmissible for tenant screening after ten years. The law maintains the ability of landlords to deny registered sex offenders on that basis.

Minneapolis property managers claimed the new restrictions could drive landlords out of business. In the years since the law was passed, such a collapse of rental property ownership hasn’t occurred. However, one study revealed that landlords began to discriminate based on race more frequently following the enactment of the law. With such data in mind and concern over housing remaining high nationwide, further changes will likely occur.

These changes are why backgroundchecks.com discontinued tenant and credit screening services effective September 2024. We cannot respond to the rapidly growing regulatory burdens as tenant screening is not our core market.

Screening may still be an essential part of landlords’ selection process. However, it is no longer always as simple as ordering a report to approve tenants. Always be sure to investigate local rules in your area. As we’ve seen with laws like those in Minneapolis, you may need to make significant changes to your process.