What is the Mrs. Murphy Exemption in housing law?
I've noticed many small property owners get confused about their rights and obligations under fair housing laws. The Mrs. Murphy Exemption is one of those tricky areas that needs clear explanation. Let me break this down for you in simple terms.
Mrs. Murphy Exemption: The Mrs. Murphy Exemption allows owners who live in small residential buildings with four or fewer units to be exempt from certain Fair Housing Act requirements when renting out their units. This exemption does not apply to discriminatory advertising or racial discrimination, and cannot be used when working with real estate professionals.
The Story Behind Mrs. Murphy
The name "Mrs. Murphy" comes from heated debates during the creation of the Fair Housing Act. Senators used the example of a hypothetical widow who rented out rooms in her home. They painted a picture of this widow who should have the right to choose who lives under her roof. While Mrs. Murphy wasn't real, her story helped shape this important housing law exception.
Who Can Use This Exemption?
You might qualify for this exemption if you:
Own and live in the property
Have four or fewer rental units in the building
Rent as an individual (not through a company)
What's Covered and What's Not
This exemption gives you some flexibility in choosing tenants, but it's not a free pass to discriminate. Here's what you need to know:
Not Allowed (Even With the Exemption):
Discriminatory advertising of any kind
Racial discrimination
Using the exemption when working with real estate agents
Real-World Applications
The exemption makes the most sense for:
Owner-occupied duplexes
Small apartment buildings where you live
Your personal home where you rent out rooms
State vs Federal Rules
Your state might have stricter rules than federal law. Some states don't recognize the Mrs. Murphy Exemption at all. I always suggest checking your local laws before making rental decisions.
Making Smart Choices as a Property Owner
If you qualify for the exemption, you still need to:
Keep good records of your rental practices
Treat all tenants fairly
Create clear rental policies
Working With Professionals
Remember - once you hire a real estate agent or property manager, the exemption no longer applies. This is why many small landlords choose to handle rentals on their own.
Taking Action
If you own a small rental property, you need to understand both your rights and responsibilities. Bellhaven Real Estate offers expert guidance on property management and can help you navigate these complex waters. We provide free consultations to discuss your property management needs and can show you investment opportunities that make sense for your situation.
The Mrs. Murphy Exemption exists to protect small property owners while still maintaining fair housing practices. Used correctly, it helps balance the rights of property owners with the need for fair housing opportunities.