Housing Discrimination and the Destruction of Disparate Impact Claims

Posted on: June 29, 2026

employment discrimination lawyer St. Louis, MO

The right to be able to secure adequate housing, free from prejudice, is one our government enshrined and codified in the Fair Housing Act (FHA). The FHA mandates that it is illegal to discriminate against anyone in housing related activities based on that person’s race, color, national origin, religion, sex, familial status, or disability. Moreover, the disparate impact function of the FHA has served to prevent and discourage discrimination regardless of intent. However, the U.S. Department of Housing and Urban Development (HUD) has recently announced their plan to end using disparate impact liability in fair housing enforcement, a decision which will have dire consequences for countless Americans. A St. Louis, MO employment discrimination lawyer can help individuals understand their rights under federal anti-discrimination laws and evaluate potential claims involving unlawful discrimination and unequal treatment.

How the FHA Works and Who it Protects

The FHA was passed in 1968, and one of its central goals was ending discrimination in housing. This meant prohibiting discrimination in buying, selling, leasing, and financing a home. The FHA applied to “direct providers of housing,” such as landlords and real estate companies, but also more broadly, to institutions like banks and municipalities.  The FHA is largely administered by HUD, alongside enforcement collaboration between HUD and the Department of Justice’s Civil Rights division. While the FHA was a major step in ending discriminatory housing practices, such as red lining and predatory loan programs, unlawful prejudice continues to be a major problem.

A Landmark Moment for Housing Discrimination

Recognizing that discrimination often exists regardless a proving of discriminatory intent, and the reality that the FHA was losing much of its utility without an adequate enforcement arm, the Supreme Court enhanced the ability to bring claims under the FHA in 2015. In Texas Dept. of Housing v. Inclusive Communities Project, the Court recognized disparate impact claims as justiciable under the FHA. This meant that claimants no longer had to prove discriminatory intent, rather a Plaintiff can bring suit against a housing practice if that practice has a disproportionately negative impact on a protected group, so long as that practice actually caused the disparity. This was hugely important as proving discriminatory intent can be exceedingly difficult, even when the discriminatory result is plain to see. The Courts affirmation of disparate impact claims ensured the FHA could strive nearer to its goal of ending discriminatory housing practices. However, this crucial arm of the FHA is now under attack.

The Dismantling of Fair Housing

In the past year, the HUD secretary has announced new guidelines for the administration of disparate impact claims. HUD has rescinded the disparate impact rule originally vindicated in the Inclusive Communities Project case. More than this, the current administration has backed off several major investigations into housing discrimination, and additionally fired hundreds of HUD employees. By rescinding the disparate impact claims rule, HUD has nullified an essential anti-discrimination measure. HUD added fuel to the housing discrimination fire in terminating dozens upon dozens of employees, effectively reducing the FHA to its pre-Inclusive Communities stature.

An Uncertain Future for Housing Equality

The FHA is a tremendously important piece of anti-discrimination legislation, as the need for a home is a basic necessity, and discrimination in housing practices has run rampant for centuries in our nation. The disparate impact claims vindicated by the Supreme Court in 2015 represented a promising step toward affording the FHA its rightful authority. However, the current HUD administration has taken a flamethrower to this authority, with indiscriminate terminations and rescission of the disparate impact claim process. These in combination suggest housing discrimination will be on the rise, a problem the drastically reduced HUD agency will likely be ill-equipped to handle.

If you believe you have experienced unlawful discrimination in housing, employment, or another protected area, it is important to understand your legal rights and options. Contact TGH Litigation to discuss your situation and learn how experienced legal counsel may be able to help.