The White House announced a plan on Wednesday that it says will protect renters and help curb rental costs, although at least one national housing association has expressed reservations about it.
A so-called “Blueprint for a Renters Bill of Rights” (pdf) was included in a White House fact sheet released Wednesday. It lays out proposals for federal agencies and other entities, including “access to safe, quality, accessible, and affordable housing” as well as “clear and fair leases.”
“This Blueprint and the federal actions that promote these principles were developed as part of a six-month process to seek and distill input from people across the country—from tenants to housing providers, legal associations, and advocates,” it says. “By engaging in dialogues, listening sessions, roundtable discussions, and stakeholder meetings, people from across the United States spoke up about the importance of tenant protections, rental affordability, and resident-centered property management practices.”
More than 44 million households, or about 35 percent of the U.S. population, live in rental housing, the White House estimated.
The White House said it will direct the Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau to obtain information and identify practices that unfairly prevent tenants or applicants from accessing housing.
“This is the first time the FTC has issued a request for information exploring unfair practices in the rental market. The two agencies will seek information on a broad range of practices that affect the rental market, including the creation and use of tenant background checks, the use of algorithms in tenant screenings, the provision of adverse action notices by landlords and property management companies,” the fact sheet said.
According to recent data from the Rent Report, rent prices rose 7.45 percent year-over-year in November 2022. While noting that “the 7.45 percent increase was the lowest rise over the last 15 months,” the Rent Report said that “prices are still elevated and those changes are higher than normal.”
However, analysts have expressed skepticism about whether the FTC or other agencies could impose rent controls or if courts would strike such policies down when challenged.
“The Supreme Court is more conservative. It is less inclined to let agencies assert authorities that Congress did not explicitly give them. Congress never empowered the FTC to limit how much residential rents may increase,” Cowen analyst Jaret Seiberg wrote in a recent note, Yahoo reported. “It is why we would expect the courts to reject this type of regime.”
Seiberg, meanwhile, noted that costs vary between cities. Buildings also get upgraded and remodeled, he added.
“The FTC is a relatively small agency,” he wrote. “We don’t see how it could account for all this in a way that could survive court challenges.”
Bob Pinnegar, the head of trade group the National Apartment Association, told CNBC that his group is opposed to more federal government involvement.
“Complex housing policy is a state and local issue and the best solutions utilize carrots over sticks,” Pinnegar said.
During the COVID-19 pandemic, the federal government and some state governments issued eviction moratoriums that were often challenged in court. In mid-2021, the Supreme Court overturned the federal moratorium, arguing, in part, that the federal Centers for Disease Control and Prevention (CDC) sidestepped Congress to issue such a rule.
“It would be one thing if Congress had specifically authorized the action that the CDC has taken,” the Supreme Court opinion read. “But that has not happened.”
“Instead, the CDC has imposed a nationwide moratorium on evictions in reliance on a decades-old statute that authorizes it to implement measures like fumigation and pest extermination,” wrote the majority. “It strains credulity to believe that this statute grants the CDC the sweeping authority that it asserts,” the opinion noted.