On Tuesday, President Joe Biden urged Congress to pass legislation that would provide “corporate landlords” with the option of limiting annual apartment rent increases to 5% or risk losing faster depreciation write-offs. This proposal is one of three announced by Biden on Tuesday aimed at addressing rental affordability.
The proposed rent cap would apply to landlords who own more than 50 units, encompassing over 20 million units nationwide. It includes an exception for new construction and significant renovation or rehabilitation projects and will be in effect for the next two years.
In a statement, Biden stated that while the previous administration gave special tax breaks to corporate landlords, his focus is on reducing housing costs for families. He called on Republicans in Congress to join Democrats in passing his plan as a means of providing relief for Americans struggling with high housing costs.
Responding to this proposal, National Multifamily Housing Council President Sharon Wilson Géno emphasized that implementing policies aimed at expanding housing supply would better serve the goal of lowering housing costs and supporting residents. She also pointed out that according to their own Housing Supply Action Plan, increasing supply is crucial in creating sustainable solutions rather than relying on ineffective measures such as rent control which has been proven unsuccessful over decades.
Other key components outlined by Biden include repurposing surplus federal, state and local government land towards building affordable housing options and allocating $325 million through HUD Choice Neighborhood grants towards constructing or rehabilitating low-income units.
This article was originally published by Connect CRE.
