White House Mulls Tenant Protections as Local Rent Control Push Grows

At a time when apartment rents are starting to descend from the record highs—and the momentum for rent controls appears to be building—the Biden Administration said it is considering several executive actions that would expand protections for renters.

Among the measures on the table at the White House are standardized rental leases; grace periods for late rents; a right to counsel for tenants facing eviction; the sealing of eviction records; and a federal campaign to end discrimination against affordable housing voucher holders based on the source of income, Bloomberg reported.

The smoke signals from Pennsylvania Avenue came in response to a letter from Sen. Elizabeth Warren to President Biden, signed by 50 members of Congress and made public last week, calling for the president to issue an executive action ordering a cap on rent hikes in properties backed by Fannie Mae, Freddie Mac or the US Department of Housing and Urban Development.

Warren also called for a new Federal Interagency Council on Tenants’ Rights. She proposed to deploy the Federal Emergency Management Agency—which oversees disaster-relief efforts—to play a role in finding shelter for homeless people.

Landlord groups including the National Multifamily Housing Council (NMHC) and National Apartment Association (NAA) have weighed in with their own letter to Biden urging the president to resist calls for new federal housing requirements, saying such measures would “further exacerbate affordability challenges” by slowing development of new housing.

The tenant-protection proposals in Washington DC are coming as momentum appears to be building across the US in favor of giving city officials the right to make decisions about rent control by lifting state preemption laws.

In Massachusetts, state and local officials are lining up for a citywide rent cap in Boston. Boston Mayor Michelle Wu is preparing to release a proposal that would cap rent increases in the city at 6% plus the change in the Consumer Price Index, according to the National Multifamily Housing Council’s latest rent control update.

Before Boston can enact such a rent cap, state lawmakers will need to lift the rent control preemption law in Massachusetts. Incoming Gov. Maura Healey says lifting the state preemption on rent controls is one of her top priorities.

Since the beginning of the year, bills have been introduced in six states that would lift laws giving the state preemptive authority over rent control measures, including Minnesota, New Hampshire, New Mexico, South Carolina, Virginia and Washington.

A bill introduced in the Washington State House would cap rent increases to no greater than the rate of inflation as measured by the Consumer Price Index or 3%, whichever is greater, up to a maximum of 7%. In South Carolina, a bill would restrict rent increases to 7% plus the change in the CPI.

A bill introduced in New Hampshire proposes to lift state preemption and allow city or town officials to pass emergency bylaws without voter approval to lengthen the notification time for rent increases and to place caps on rent increases.

The national median rent has fallen for four straight months, according to the latest data from Apartment List. Thus far, the dip has barely made a dent in the rent growth of the past two years, with the December drop in the national median ticking down just 0.8%.

New lease demand plummeted in the second half of 2022—when net demand for apartments turned negative for the first time since 2009, according to a RealPage analysis.

According to RealPage, slumping demand is about to be compounded by the largest surge in supply in more four decades: more apartment units are under construction than at any point since 1970, with a significant percentage of that new supply slated for delivery this year.