The housing industry is up in arms over new tenant protections that the Biden administration is preparing to roll out as soon as this month, Politico reports.
The protections, which come as rents around the country are falling, could include promoting grace periods for late rents, as well as giving renters who are facing eviction the right to legal counsel, according to advocates.
According to Jerry Howard, CEO of the National Association of Home Builders, the industry is bracing for "some pretty intense regulation."
"They need to be very cautious about what they’re doing," he added, having attended a November White House meeting on tenant protections. "There’s a real chance of creating a problem that doesn’t exist."
With a possible recession looming, the Biden administration will be looking for ways to provide relief to cash-strapped Americans suffering from a higher cost of living. Since the U.S. House is now under Republican control, the kind of sweeping economic legislation enacted during the last two years is off the table.
Democratic lawmakers including Sen. Elizabeth Warren (D-Mass.), are leaning on the administration to go big by curbing rent increases at millions of units in properties with government-backed mortgages – a long-shot move the White House is not seriously weighing, according to a person with knowledge of the discussions. -Politico
The National Apartment Association and 10 other industry groups are lobbying the White House to resist pressure to enact new federal requirements on top of existing laws - insisting in a December letter that doing so would "further exacerbate affordability challenges."
"People can’t afford to live," said Rep Jamaal Bowman (D-NY). "We want to push the president as far as possible to lighten the burden of rent on everyday people."
Democrats are pushing the Biden administration to enact restrictions on rent hikes and punish landlords who they say are price gouging.
"[N]ot just principles, not just guidelines, but what can the president do through executive action to lighten the burden on people and put more money in their pockets," Bowman told Politico in an interview.
The White House, meanwhile, appears to be in agreement - though it has yet to comment on specifics.
"We are exploring a broad set of administrative actions that further our commitment to ensuring a fair and affordable market for renters across the nation," according to spokesperson Robyn Patterson. "We look forward to continuing to work with lawmakers to strengthen tenant protections and improve rental affordability."
While rent is still driving up overall inflation — thanks in part to a data lag in the official inflation gauge — the national median rent has fallen for four straight months, according to the latest data from Apartment List. New lease demand plummeted in the second half of 2022, when the net demand for apartments fell into negative territory for the first time since 2009, according to an analysis by RealPage Market Analytics. -Politrico
"Complicating this process isn’t good at any time in the market cycle," said Greg Brown, senior VP of government affairs at the National Apartment Association. "But we’re in the fourth straight month of rent declines. I think things are adjusting again, so it does raise the question, are they responding to a situation of three to four months ago, not what is currently happening or will be happening in the near future?"