The National Association of Realtors on Tuesday criticized the administration’s proposals to withdraw tax credits from corporate landlords who raise rent by more than 5% per year. The NAR said in a statement that price caps on rent discourage developers from building new rental properties and decrease the supply of low- to mid-range housing units.
What exactly is Biden proposing? President Joe Biden on Tuesday called on Congress to pass legislation that would push corporate landlords to cap rent increases on existing units over the next two years. The plan would apply to landlords with more than 50 units in their portfolio, which accounts for more than 20 million rental units across the country, according to the White House. Biden’s plan is unlikely to gain the congressional support it needs to pass.
The proposal would also repurpose public land in Nevada to build up to 15,000 affordable housing units and calls on state and local governments to consider whether the land they hold could be suitable for redevelopment. As part of Biden’s announcement, the U.S. Department of Housing and Urban Development on Tuesday said that the administration plans to invest $325 million in Choice Neighborhoods grants. The funding would be used to revitalize distressed neighborhoods and build affordable housing.
How have other trade groups responded? The National Multifamily Housing Council on Monday spoke out against the Biden administration’s rent cap proposal, saying the legislation would not create the new housing needed to address shortages. Rent control has been tried for decades and has been a resounding failure NMHC President Sharon Wilson Géno said in the release. She added that it’s time for actual solutions, not electioneering.
Bob Broeksmit, CEO of the Mortgage Bankers Association, called the proposal politically motivated and said financial incentives for home builders and landlords would bolster new housing development. The National Apartment Association also criticized the proposal.
Meanwhile, the President of the Nevada REALTORS Brandon Roberts said Biden’s plan to release federal land for development does not help residents who don’t qualify for HUD housing but still struggle to afford housing.
Is alternative legislation being discussed? The National Association of Realtors on Tuesday said it supports the Yes In My Backyard and Neighborhood Homes Investment Act bills as legislative initiatives aimed at tackling housing affordability and accessibility.
What is the Yes In My Backyard bill? The bill requires certain Community Development Block Grant program recipients to submit to the Department of Housing and Urban Development information regarding their implementation of certain land-use policies, such as policies for expanding high-density single-family and multifamily zoning.
What is the Neighborhood Homes Investment Act? The bill allows a business-related tax credit for certain development costs for the acquisition, rehabilitation, or remediation of qualified real property.
What is the current state of the housing supply? Inflation for shelter rose in June at the slowest pace in three years, according to the Bureau of Labor Statistics’ latest report. However, housing prices have remained high in recent years and 22.4 million renter households spent more than 30% of their income on rent and utilities in 2022, according to the Joint Center for Housing Studies at Harvard University.
Freddie Mac, the federal home loan mortgage corporation, in May estimated that the United States needs to add an additional 1.5 million vacant for-sale and for-rent homes to meet current demand.
This story originally appeared in WORLD. © 2024, reprinted with permission. All rights reserved.
