Fed Could Flex Powers on Rent Control

No one would blame you for not hearing about a recent move by the White House to ease rent increases for some Americans.

Despite relatively scant press coverage, the Biden administration did take action on rent control earlier this year, capping rent increases on 2.6 million apartments that receive federal subsidies (paid to the developer).

“People are hurting and some of their deepest pain is around rent. People need relief that they can feel when they pay their monthly bills. In an election year, this matters a lot,” Tara Raghuveer, director of the National Tenant Union Federation, told The New Republic. 

When you consider that 59 percent of respondents to a national poll – conducted before the pandemic – supported rent control, and 57 percent of millennial renters recently told Zillow that they would need to hit the lottery to be able to buy a home, it is no surprise that housing costs consistently rank high on Americans’ list of concerns. 

Debbie Brown, co-founder of the Montco 30% Project, is onboard.

In a recent interview with PBS NewsHour, the National Low-Income Housing Coalition’s Diane Yentel cited the need for a “rebalance of power” in a housing market where corporate landlords seek exorbitant profits on the backs of struggling renters with fixed incomes. 

Enter the federal government and President Joe Biden. 

The White House action affecting 2.6 million apartments was actually a 10 percent cap on rent increases for apartments receiving funding through the Low-Income Housing Tax Credit (LIHTC). This action marked a new level of federal involvement and opened the door – potentially – for more action. 

For example, Fannie Mae and Freddie Mac are federally-backed enterprises that do $150 billion worth of business with landlords – covering loans to over 12 million units. 

Why not expand rent control to ALL federally-financed units? 

As Raghuveer stated in TNR, “In many ways, Fannie and Freddie enable and encourage some of the worst practices in the real estate market. We want to see a uniform set of regulations, including rent caps, attached to Fannie and Freddie financing. If you benefit from federally backed financing, you should be subject to those terms.” 

More than 30 economists signed on to a letter to the Federal Housing Finance Agency backing rent control. So while much of the conversation around housing policy emanates around the local, county, and state levels, don’t give your federal elected officials a free pass. During a recent virtual meeting with Montco 30%, a staff member with Sen. John Fetterman shared a federal grant program to remove obstacles to zoning – Pro Housing: Pathways to Removing Obstacles. 

Similar to rent control, zoning reform is also popular with the people, according to recent surveys from Pew Trusts.

Elsewhere, the YIMBY Act was voted out of committee last month and could receive a vote on the full House floor in Washington. Call or write to your member of Congress!