My wife and I own a duplex. we rent out the second floor. we have an application from a couple that has two foster kids plus one of their own and from time to time they take in others for respite, etc. For us at 78 years old, the situation feels like a very bad fit. Are we required to rent to a foster family.
OK, I have been out of this type of land lording for a long time. But depending on the size of the unit you can limit the total count on occupants so I would check with fair housing agency and discuss it with them and some one knowledgeable there, not the first person to answer the phone, as a matter of fact call on different days and hopefully get a different person and compare answers. I don’t know what has changed over the last ten years.
Also the fact that your the owner occupant of the other unit gives you some rights a landlord renting both units doesn’t have. And at my age I don’t want a bunch of kids over my head.
If the housing laws allow up to five that means by contract you can control the limit and they can’t take any extra kids even temporarily and that may help them change their mind.
Checking out your law
If you’ll find and join the largest Rental Ass’n in your state it’ll have the info on your state law on tenants’ rights etc and a look at your city’s ordinances (Google) will tell you what they say re Ts’ rights and LLs’ responsibilities.