Can I Set an Occupancy Limit?

Logic suggests that each additional occupant in a dwelling unit is likely to result in greater administrative burden, increased utility usage, more wear and tear on the property, and greater demands for parking. For these reasons and others, housing providers and local governments alike have created policies to limit the number of people living in residential housing units. Over the years, this practice has become increasingly more challenged under fair housing law. 

Since familial status became a protected class in 1974, it became understood that unreasonably low occupancy limits can have a discriminatory effect on families. In 1991 HUD’s general counsel, Frank Keating, provided internal guidance to regional counsel to facilitate their review of fair housing cases regarding occupancy policies and familial status. The guidance document makes it clear that the federal government would not provide any safe harbor occupancy standard that housing providers could reference. Only that “… in appropriate circumstances, owners and managers may develop and implement reasonable occupancy requirements based on factors such as the number and size of sleeping areas or bedrooms and the overall size of the dwelling unit.”1 In other words, housing providers could come up with “reasonable” limits, but there would be no safe harbor protection in a fair housing case… unless the occupancy limit was based on a local statue or building code.  

To avoid the risk of discriminating against families, many landlord policies specifically limited “unrelated” occupants only. Cities such as Bellevue, Edmonds and many others, imposed limits on unrelated occupants taking the risk out of the housing provider’s hands. If defending a fair housing complaint related to the occupancy limit, a housing provider could simply refer to the city law. As commonly accepted definitions of “family” become more diverse, these policies have been found to have a discriminatory effect upon other protected groups and created barriers for low-income renters needing to share housing. As the housing shortage grows, more unrelated adults want to share housing and the Washington State legislature has come to their defense. Senate Bill 5235, effective July 25, 2021, removed “barriers and restrictions on the number of unrelated occupants permitted to live together, which will provide additional affordable housing options.” This means that city codes limiting unrelated occupants in dwelling units are now illegal under RCW 35A.21.314. Cities such as Edmonds and Bellevue have already removed existing codes that imposed such limits. But what does this mean for housing provider policies?

While it is still legal for a housing provider to set and enforce “reasonable” occupancy limits, the only safe harbor occupancy limit in Washington State is based on building code, such as septic system capacity or fire code. Best practice is to have a reasonable occupancy guideline that is based on legitimate business concerns, keeping in mind that any number of specific circumstances could turn an unreasonable number of occupants into reasonable. Examples provided in the “Keating Memo” suggest that in most cases, a reasonable starting point may be two occupants per bedroom plus one. However, the housing provider should be flexible based on the specific circumstances of the applicant and their desired housing unit. For example, you may have an occupancy limit of 5 people in a two bedroom, but what if a couple has four children under the age of 4 and the large apartment has plenty of room for all of them? The safest course of action is to only advertise and strictly enforce your occupancy policy if it is based on building code, like a septic system approved for a limited number of occupants. 

The city of Tacoma has recently passed legislation that requires landlords to include the building-code-based occupancy limit in their lease, effectively eliminating the opportunity for a landlord to deny tenancy based on any arbitrary occupancy limits. The Tacoma code is very similar to guidelines provided by HUD mentioned earlier.

For a quick summary of these best practices, go to RHAwa.org/support-center and search for “Occupancy Limits.”

1.    Frank R Keating, “Memorandum for All General Counsel, Fair Housing Enforcement Policy: Occupancy Cases,” Department of Housing and Urban Development (Department of Housing and Urban Development, December 22, 1998), https://www.hud.gov/sites/documents/DOC_7780.PDF.

This article was written and edited by RHAWA representatives and is intended for the use of RHAWA members only. Copyrighted members-only materials may not be further disseminated. Formal legal advice and review is recommended prior to selection and use of this information. RHAWA does not represent your selection or execution of this information as appropriate for your specific circumstance. The material contained and represented herein, although obtained from reliable sources, is not considered legal advice or to be used as a substitution for legal counsel.