Case Files: New Landlord, New Rules…But Are They Legal? – Episode 38

When a rental property changes ownership, it’s common for new landlords to make updates—adjusting rent, updating lease terms, or revising policies. But what happens when those changes are not applied fairly and consistently? The case of United States v. Pesure offers a powerful reminder: fair housing laws do not reset with a new owner.

New Landlord – What Happened?

The property in question was a small rental in New Jersey. One of the residents, Brittany Doyle, a Black tenant and Housing Choice Voucher (Section 8) participant, had lived there with her children since 2016. In 2021, the property was sold, and the new owners immediately announced large rent increases—telling tenants that refusal to accept would result in eviction.

When the housing authority pushed back on these increases, they proposed a modest $40 raise for a white tenant also using a Section 8 voucher. The new owner accepted this proposal. But when it came to Brittany Doyle’s lease renewal, the owner insisted on a 37.5% increase—nearly 14 times higher than the white tenant’s. The housing authority again recommended the same $40 increase, but the owner refused without explanation and served a non-renewal notice.

New Rules – Unequal Terms and Allegations of Discrimination

Beyond rent increases, the complaint alleges that Brittany Doyle’s proposed lease included stricter, burdensome terms not found in other leases at the property. These included excessive late fees, a shorter grace period for rent payments, restrictions on overnight guests, requirements for snow removal and repair costs, and permission for the landlord to install surveillance cameras anywhere on the property. All of these conditions were reportedly included in her lease but not in the lease of the white tenant. Compounding this issue, the white tenant lived in a larger unit, yet was expected to pay less.

Retaliation Allegations

After challenging the discriminatory treatment, Brittany Doyle allegedly faced retaliation. The complaint states that the landlord attempted to have her voucher revoked, filed an eviction notice during negotiations, and contacted multiple agencies to make negative claims in an effort to prevent her from finding alternative housing. If proven, these actions would constitute retaliation, a clear violation of the Fair Housing Act.

What Property Managers Should Know

This case serves as a reminder that fair housing laws apply regardless of ownership changes. A new owner inherits not only the property, but the responsibility to follow federal fair housing rules. Rent and lease changes must be based on legitimate, consistent criteria—not on race, voucher status, or any other protected characteristic. If there are differences in rent due to unit size, location, or amenities, it is critical to have documentation to explain those differences. And importantly, once a tenant asserts their fair housing rights—whether formally or informally—retaliatory actions are strictly prohibited.

What Could Happen Next?

If the court rules in favor of the plaintiff, the defendants could face substantial financial penalties, be ordered to pay damages, complete fair housing training, adopt new policies, or submit to oversight. In some cases, courts may even determine that a landlord is no longer fit to operate rental housing, depending on the severity of the violations.

Final Thoughts

This case illustrates how easily new ownership changes can turn into legal issues when not handled with fairness and consistency. If you are taking over a property and planning changes, it’s wise to consult legal counsel to ensure compliance with the Fair Housing Act. Following uniform policies and treating all residents equally isn’t just good practice—it’s the law.

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