The U.S. Department of Justice (DOJ) recently announced a major change to how federal civil rights laws are enforced. The agency will no longer use the “disparate impact” standard when evaluating programs that receive federal funding.
This change has direct implications for property managers and rental housing providers. Here’s what you need to know.
What Is “Disparate Impact”?
Disparate impact is a legal theory that says a policy can be considered discriminatory if it disproportionately affects certain protected groups, even if there was no intent to discriminate. In 2015, the US Supreme Court recognized that a “Disparate Impact” standard is the appropriate way for U.S. Courts to review claims of discrimination under the FHA. In housing, this can include things like:
- Tenant screening policies
- Eviction rules and practices
- Occupancy limits
Previously, even facially neutral rules could trigger federal enforcement if they had a disproportionate effect on a protected class.
What Has Changed
Under the new DOJ rule:
- Federal enforcement by Administrative Agencies will focus only on intentional discrimination. (NOTE – the standard of review for US Courts has not changed)
- Policies that are neutral on their face but affect groups differently are less likely to trigger federal action.
- This change comes after an executive order directing federal agencies to stop pursuing disparate impact claims.
Why This Matters for Property Managers
For property management professionals, the change provides some clarity:
- Lower federal enforcement risk for neutral leasing and eviction policies.
- It is still critical to ensure that policies do not intentionally discriminate.
- Continue to comply with state and local fair housing laws, which may still recognize disparate-impact claims and remember that Fair Housing Lawsuits will still be evaluated by the Court using “disparate impact” analysis.
- A good opportunity to review leasing and eviction policies for fairness and documentation.
Key Takeaway
While this change narrows federal enforcement, fair housing compliance remains a top priority. Property managers should use this as a chance to ensure policies are clear, consistent, and legally sound, protecting both residents and your business.
Learn more: DOJ Press Release on Disparate Impact Rule
Published: January 5, 2026
