San Francisco landlords systematically and illegally refuse to rent to people with Section 8 housing vouchers, a year-long undercover sting by a watchdog group found.
Investigators from the Housing Rights Initiative nonprofit posed as prospective tenants and asked landlords whether they accept Section 8 vouchers. The watchdog said its investigators were discriminated against 44% of the time in San Francisco and found similar results in Oakland, San Jose, and Los Angeles.
The group is now asking state regulators to punish 203 California real estate agents, brokerage firms, and landlords for allegedly violating a 2019 law that prohibits discriminating against voucher holders, in a mammoth civil rights complaint.
Section 8 vouchers are federally funded subsidies that help low-income, elderly, and disabled tenants pay for housing.
Aaron Carr, executive director of Housing Rights Initiative, said the findings likely understate the problem.
“Many real estate companies aren’t dumb enough to discriminate via text message,” Carr said.
He added that of the San Francisco properties investigators surveyed, 19 said yes when asked if they accept the vouchers, and 15 illegally said no.
Some landlords either stopped responding or didn’t give a clear answer, though Carr did not know the exact number. The watchdog said it texted “hundreds” of brokers and landlords across the state.
Josh Murillo, deputy director of the Housing Rights Initiative, said investigators conducted “indiscriminate testing on any and all listings that fall within the maximum rent a voucher holder can afford.”
He added, “This is the gold standard of housing enforcement: Test everyone.”
In San Francisco, the properties were generally located in sought-after neighborhoods like Mission Dolores and the Outer Sunset, and the average rent was $2,965.
Many of the landlords who were named in the report denied wrongdoing.
Walter Raineri, a lawyer who was listed as the landlord for an apartment in a luxury building at 219 Brannan St., denied turning away a prospective tenant with a Section 8 voucher before hanging up the phone on The Standard.
“I have no knowledge of any such situation and will have to wait until I am contacted by someone who believes otherwise,” he said. “And I have no comment otherwise.”
Damon Fanucchi, owner of the Rental Source property management firm, said his agents are trained to encourage tenants with Section 8 vouchers to apply for apartments.
Text messages show that one of his employees told a prospective tenant that the landlord of a Valencia Street building would not accept Section 8; Fanucchi told The Standard that was a mistake.
“We don’t have a stake in turning people away. We know all the rules and don’t discriminate,” Fanucchi said by phone. “I’m a little bit shocked, because we tell the agents how to handle these things. If that’s what the agent said, it wasn’t right.”
He said he has owned the Rental Source for 25 years, and the company has several tenants with Section 8 vouchers who live at other properties.
“I wouldn’t have been in this business for so long if I was doing something shady,” Fanucchi said.
Other brokers, like Sotheby’s International Realty, did not respond to requests for comment. One landlord named by the watchdog, Danielle Monrroy, said she wasn’t able to give a statement as she had brain surgery scheduled for Friday morning.