Affordable Housing: Rent Control Laws Are Back in These States

Red For Rent Real Estate Sign in Front House.
Feverpitched / Getty Images/iStockphoto

With U.S. home prices surging to historic highs and rents rising across the country, lawmakers are once again taking aim at rent control legislation to promote more affordable housing.

See: Rental Prices Hit Record Highs as Market Rebounds
Find: The 25 Best Rental Markets in the US Right Now

Proposals that would put a cap on how much landlords can raise rent are on the legislative agenda in more than a dozen states, The Wall Street Journal reported. These proposals — which would typically limit rent increases to a range of 2% to 10% — are in response to record rental prices in the United States.

Rental prices in the U.S. are up about 18% on average over the past two years, according to Redfin. As GOBankingRates previously reported, a survey from the rental platform Zumper found that the median rental price of a one-bedroom unit rose 11.6% in 2021 alone, while the median price of a two-bedroom unit climbed 13.6%.

“Rents are exploding at a pace far faster than income,” Stijn Van Nieuwerburgh, an economist and professor at Columbia Business School who researches rent control, told the WSJ. “The problem is now as bad as it has ever been. And probably much worse.”

Building Wealth

See: As Home Prices Reach 34-Year Record, Mortgage Rates Could Be Final Nail in Coffin for Some Homebuyers

To help tame rent inflation, numerous states, including Massachusetts, New Jersey, Colorado and Florida, are considering local rent control measures, the WSJ noted. Measures are being discussed in a wide range of different communities, from large metro areas such as Boston to wealthy suburbs like Montclair, New Jersey and lower-income mobile-home communities in Colorado.

Some cities have already adopted strict rent control measures. For example, St. Paul, Minnesota, approved a rent control law last fall that does not make exceptions for new buildings or vacant units. Santa Ana, California, limits annual rent increases to 3% for any apartments built before 1995, which is below the state’s rent control cap of 5% plus local inflation.

Currently, 36 states preempt local governments from adopting rent regulation laws, according to the National Apartment Association. Only the District of Columbia, New York and Oregon — along with certain municipalities in California, New Jersey and Maryland — have rent control or rent stabilization policies in place.

Find: 2022 Financial Forecast for Renters — Will Rents Go Down Anytime Soon?

“However as housing instability and tenant displacement concerns gain more attention, local governments are increasingly pushing back on preemption laws and considering adoption of these restrictions,” the NAA said on its website.

Building Wealth

In many cases, local officials must work around state laws governing how much, and even whether, rents can be capped. In Boston, for example, Mayor Michelle Wu campaigned on bringing rent control back to the city even though a statewide referendum bans local rent controls, the WSJ reported. Massachusetts Democrats back a bill to repeal the state ban, but it’s unlikely to be signed by Republican Gov. Charlie Baker.

In Florida, officials in Miami and Tampa are considering declaring housing emergencies to pass rent control to get around their own state’s rent-control laws.

More From GOBankingRates

About the Author

Vance Cariaga is a London-based writer, editor and journalist who previously held staff positions at Investor’s Business Daily, The Charlotte Business Journal and The Charlotte Observer. His work also appeared in Charlotte Magazine, Street & Smith’s Sports Business Journal and Business North Carolina magazine. He holds a B.A. in English from Appalachian State University and studied journalism at the University of South Carolina. His reporting earned awards from the North Carolina Press Association, the Green Eyeshade Awards and AlterNet. In addition to journalism, he has worked in banking, accounting and restaurant management. A native of North Carolina who also writes fiction, Vance’s short story, “Saint Christopher,” placed second in the 2019 Writer’s Digest Short Short Story Competition. Two of his short stories appear in With One Eye on the Cows, an anthology published by Ad Hoc Fiction in 2019. His debut novel, Voodoo Hideaway, was published in 2021 by Atmosphere Press.

Best Bank Accounts of May 2022

Untitled design (1)
Close popup The GBR Closer icon

Sending you timely financial stories that you can bank on.

Sign up for our daily newsletter for the latest financial news and trending topics.

Loading...
Please enter an email.
Please enter a valid email address.
There was an unknown error. Please try again later.

For our full Privacy Policy, click here.