If you are preparing to earn your real estate license in the North Star State, mastering fair housing laws is not optional—it is a critical requirement. The Minnesota Department of Commerce ensures that all licensed real estate professionals operate with a strict adherence to both federal and state anti-discrimination laws. This mini-article breaks down the essential concepts of protected classes and discrimination that you will encounter on your test. For a broader look at your overall testing journey, be sure to bookmark our Complete Minnesota Exam Guide.
Federal Fair Housing Act vs. Minnesota Human Rights Act
One of the most heavily tested concepts on the state portion of the Minnesota real estate exam is the distinction between federal and state protected classes. As a real estate agent, you must comply with the strictest applicable law. Because state laws often provide broader protections than federal laws, understanding the Minnesota Human Rights Act (MHRA) is paramount.
The Federal Protected Classes
The Federal Fair Housing Act (Title VIII of the Civil Rights Act of 1968, along with its amendments) prohibits discrimination in housing based on seven protected classes. A common mnemonic to remember these is FReSH CoRN:
- Familial Status (added in 1988)
- Race
- e
- Sex (added in 1974)
- Handicap / Disability (added in 1988)
- Color
- o
- Religion
- National Origin
Minnesota-Specific Protected Classes
The Minnesota Human Rights Act (MHRA) includes all the federal protections but goes further by adding several state-specific protected classes. On the Minnesota state exam, you must know these additions by heart:
- Marital Status: You cannot discriminate against someone because they are single, married, divorced, or widowed.
- Sexual Orientation: Minnesota was one of the first states to explicitly protect sexual orientation and gender identity in housing.
- Receipt of Public Assistance: A landlord cannot refuse to rent to a tenant solely because they use Section 8 housing vouchers or receive other forms of government aid.
- Creed: Often grouped with religion, creed refers to a system of beliefs.
Is this legal? No. While this might not explicitly violate the Federal Fair Housing Act in all jurisdictions, it is a direct violation of the Minnesota Human Rights Act, which prohibits discrimination based on the "receipt of public assistance."
Common Discriminatory Practices
The exam will test your ability to identify illegal practices in real-world scenarios. The three most common violations are:
1. Steering
Steering occurs when a licensee directs buyers toward or away from certain neighborhoods based on a protected class. Even if the agent believes they are being helpful, this is illegal.
Example: An agent tells a buyer, "Since you have young children, you probably want to look in the southern suburbs where there are more families and better schools." This is steering based on familial status.
2. Blockbusting (Panic Peddling)
Blockbusting is the illegal practice of inducing homeowners to sell their properties by suggesting that people of a particular protected class are moving into the neighborhood, which will allegedly cause property values to drop.
3. Redlining
Redlining is typically committed by lenders or insurance companies. It involves refusing to issue loans or insurance policies in specific geographic areas, regardless of the applicant's financial qualifications, often due to the racial or ethnic composition of the neighborhood.
Fair Housing Complaints in Minnesota
Understanding where fair housing violations most frequently occur can give you practical context for your real estate career. Below is a breakdown of the most common fair housing complaints filed in Minnesota based on recent state data estimates.
Common Fair Housing Complaints in MN (%)
As the chart illustrates, disability-related complaints (such as a landlord refusing to allow a reasonable accommodation like an emotional support animal) make up the vast majority of fair housing disputes. You can expect exam questions testing your knowledge of reasonable accommodations and modifications.
Exemptions to Fair Housing Laws
Both federal and state laws have exemptions, but Minnesota's are generally stricter. You must know the differences for the exam.
- The "Mrs. Murphy" Exemption: Federally, an owner-occupied building with up to four units is exempt from certain Fair Housing Act provisions. However, in Minnesota, this exemption only applies to an owner-occupied duplex (two units).
- Single-Family Homes: Federally, an owner selling their own single-family home without the use of a real estate agent and without discriminatory advertising may be exempt. Minnesota law is highly restrictive here, and as a licensed agent, you are never exempt.
- Senior Housing: Housing intended for older persons (e.g., 100% of residents 62 or older, or 80% of units occupied by at least one person 55 or older) is exempt from familial status protections.
Crucial Rule: There is absolutely never an exemption for discrimination based on race, due to the Civil Rights Act of 1866.
Exam Prep Strategies & Next Steps
Fair housing questions will appear as both direct definition questions and situational word problems. Make sure you read the questions carefully to determine if they are asking about Federal law or Minnesota state law.
To ensure you are fully prepared for test day, you need to understand how these questions fit into the broader exam. Check out our breakdown of the Minnesota exam format and structure to see how the state and national portions are weighted. Additionally, knowing the time limits and question counts will help you pace yourself when reading lengthy fair housing scenario questions.
Finally, while fair housing is a heavy memorization topic, don't neglect your numbers! Balance your study sessions by reviewing our guide on amortization and monthly payment math.
Frequently Asked Questions (FAQs)
What protected classes are unique to the Minnesota Human Rights Act?
In addition to federal protections, Minnesota explicitly protects individuals against housing discrimination based on marital status, sexual orientation, receipt of public assistance, and creed.
Can a Minnesota landlord refuse to rent to someone using a Section 8 voucher?
No. Under the Minnesota Human Rights Act, refusing to rent to someone because they use a housing choice voucher is considered illegal discrimination based on the "receipt of public assistance."
Does the federal "Mrs. Murphy" (owner-occupied 4-plex) exemption apply in Minnesota?
No. While federal law allows an exemption for owner-occupied buildings of up to four units, Minnesota law is stricter. The state exemption only applies to owner-occupied duplexes (two units).
Can a real estate agent ever be exempt from fair housing laws?
No. The moment a real estate licensee is involved in a transaction, any potential exemptions that might have applied to a private "For Sale By Owner" seller are completely voided. Licensees must always adhere to all fair housing laws.
Who enforces fair housing laws in Minnesota?
At the state level, the Minnesota Department of Human Rights (MDHR) enforces the Minnesota Human Rights Act. At the federal level, the Department of Housing and Urban Development (HUD) enforces the Fair Housing Act.
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