FHFA Moves Ahead With Biden Administration's Renter Rights Program

Since January, the Biden administration has been pushing for a program to establish a renter bill of rights “to increase fairness in the rental market and further principles of fair housing.”

Now the administration is moving forward through the Federal Housing Finance Agency, which issued a request for input regarding protections that Fannie Mae and Freddie Mac could require from companies seeking multifamily mortgages.

Some of the proposals include 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.

According to recent research from Freddie Mac Multifamily, seven states already have laws prohibiting a landlord’s use of certain information, like a tenant’s criminal history, when screening tenants. Three states have implemented state-wide limits on rent increases. Colorado, Connecticut, Illinois, New Jersey, New York, and the District of Columbia prohibit or restrict the use of certain criminal history. Some state governmental agencies have recommended landlords follow such restrictions even when not required by state law.

The National Association of Home Builders said that it had been invited by the FHFA to an April 20, 2023 meeting “to discuss challenges and potential opportunities for new tenant protections for residents of multifamily properties with Fannie Mae and Freddie Mac mortgages.”

“At the April 20 meeting, several of NAHB’s multifamily housing providers urged FHFA to refrain from pressing Fannie Mae and Freddie Mac to add rent control in any form or to add source of income protections as a condition of their mortgages,” the organization said. “The members also discussed the importance of increasing the supply of housing, challenges of constructing and operating multifamily properties in an inflationary economic environment, the cost of regulations and other issues.”

This isn’t surprising given the pushback that the multifamily industry gave the White House in January. At the time, the National Apartment Association made the following short statement: “For months the National Apartment Association (NAA) worked with the White House in good faith. We stand by our commitment to promote industry resident services and practices. NAA also made clear the industry’s opposition to expanded federal involvement in the landlord/tenant relationship. Complex housing policy is a state and local issue and the best solutions utilize carrots over sticks.”

The National Multifamily Housing Council issued a longer statement that also emphasized working “in good faith with the Administration on its Resident-Centered Housing Challenge” but then added, “While they have rejected calls for failed policies such as national rent control, we are disappointed they are pursuing potentially duplicative and onerous regulations that are already appropriately addressed under state and local law. These efforts will do nothing to address the nation’s housing shortage and could discourage much-needed investments in housing.”

Some tenant advocacy organizations weren’t happy with the proposal then because they claimed the suggested changes didn’t go far enough.