On May 2, 2024, the U.S. Department of Housing and Urban Development (HUD) released two guidance documents regarding the use of artificial intelligence in the resident screening process and its application to targeted advertisements on online platforms.
The National Apartment Association (NAA) expected the release of HUD’s new guidance as the agency seeks to fulfill its commitments to the White House Blueprint for a Renters Bill of Rights. NAA anticipates heightened federal regulatory activity in May before the next Congressional Review Act (CRA) deadline. Changes in federal policy that are subject to the CRA and announced after this deadline have a greater risk of rollbacks if there is a second Trump term.
HUD’s guidance does not represent changes to the Fair Housing Act; however, it does reflect the Biden Administration’s interpretation of renters’ protections under the Act. The resident screening guidance suggests that housing providers are liable for ensuring their rental decisions comply with the Act even if they outsource screening to a third party. Moreover, HUD reiterates that the rental housing industry plays a crucial role in ensuring prospective residents are screened in a transparent, accurate and fair manner.
While the housing advertising guidance is focused on the use of artificial intelligence in targeted housing advertisements by online platforms, housing providers should be aware the guidance suggests potential fair housing violations could result “when ad targeting and delivery functions are used, based on protected characteristics, to target vulnerable consumers for predatory products or services, display content that could discourage or deter potential consumers, or charge different amounts for delivered advertisements.”
Housing providers must remain cognizant of HUD’s guidance when using artificial intelligence and algorithms in these contexts. NAA will be back in touch with its members and affiliate partners to help the industry understand any new compliance responsibilities stemming from HUD's new guidance.
NAA continues our federal regulatory advocacy with the Administration and Congress to help them understand resident screening and its value as a risk mitigation tool for housing providers, residents and rental communities. To learn more about resident screening policy, contact Joe Riter, NAA's Manager of Public Policy.