Unintended consequences of lead paint laws

Unintended consequences of lead paint laws

If you’ve ever tried to rent an apartment for a family with kids under the age of six, or even for a newly married couple, you’ve likely experienced discrimination first-hand. It often goes something like this:

Prospective tenant: Is the apartment at 123 Elm Street available?

Landlord or agent: Who is it for? / Can you tell me about yourself?

Prospective tenant: It’s for me, my spouse, and our young kids.

Landlord or agent: Sorry, it’s not suitable for families. / The upstairs neighbor smokes pot and parties. / It’s no longer available. / Bad connection, I’ll call you back. / Can I show you something else?

What just happened? The apartment in this hypothetical scenario was built before 1978 and therefore may have lead paint but it has not been tested. If anyone who lives in the apartment is under the age of six or is pregnant, then the landlord would be legally obligated to have the unit tested. If the result indicates lead-based hazards are present, then the landlord would be required to have the unit treated which, depending on the extent of the lead hazard, could cost anywhere from a few hundred dollars to tens of thousands. The landlord in this scenario wants to avoid this possibility, and therefore finds ways to refuse to rent to families.

To be clear, this is illegal. Fair Housing Laws unambiguously prohibit discrimination on the basis of, among other things, family status. But it’s also very common. There are myriad variations of discrimination, some subtle and some not. For example, one tact is to advertise the unit as “great for students or young professionals;” that’s code for “families need not apply.” Another is for brokerages to keep such listings internal, off of any cooperative system such as the Multiple Listing Service (MLS), and only share when the desired demographic calls about another listing (which often doesn’t really exist). It’s hard to complain about being denied an apartment you didn’t even know was available.

How many units are we talking about? It’s difficult to get hard numbers around the extent of discrimination itself. What we can do is, using the inventory on the MLS as a proxy for the wider apartment rental market, estimate what percentage of rental units have potential lead-based hazards, and hence have an incentive to discriminate.

As you can see in the table, 76% to 85% of units either have lead paint or have not tested, and therefore are faced with a moral hazard. That would imply approximately 13,000 rental housing units in this situation in Brookline alone.¹

Given that it’s been over 42 years since lead was banned, and that the Fair Housing Laws predate the lead paint laws, it’s implausible to believe that discrimination is not happening. Even if only a fraction of the landlords is driven to those actions, these are not marginal numbers. It’s more than enough to drive up rent for families. This has ripple effects in the for-sale market as well: it inflates demand for purchasing a home by driving people who might otherwise be better served by renting out of the rental market.

Questions to consider for how to address this:

• What additional incentives could the town offer to voluntarily de-lead? (Beyond the $1,500 per unit state tax credit). For example, could the town offer a break on property taxes for newly de-leaded units?
• If all rental units² were required to be de-leaded regardless of whether they have young kids living there or not, would that remove the incentive to discriminate against renters with kids?
• How could a requirement to de-lead be implemented? Through the building or sanitary code?
• What kind of penalties would be appropriate for non-compliance?
• What are possible outcomes of a hard requirement to de-lead? A) Landlord complies. B) Landlord sells. C) Landlord refuses and pays penalties. D) What else?
• What type of units should be excluded from the requirement? For example, owner-occupied two-family houses where the owner is elderly.

• What could be done with money collected from penalties? Could it be used to make zero interest loans or grants to landlords who get stuck with larger projects, such as window or siding replacement?

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