NAA's Rent Control Outlook

Rent control continues to be a hot-button issue across the country. While much action was seen in states like California, New Jersey and New York, other states like New Hampshire, Iowa and Michigan have begun to consider these harmful policies. In 2024, the National Apartment Association (NAA) tracked 218 state-level rent control bills across the country, with 22 bills reaching enactment. At the local level, NAA tracked 47 ordinances, resolutions, studies and ballot initiatives pertaining to rent control. The vast majority of these bills were aimed at adopting, allowing or strengthening rent control in some way.

Rent control proposals may be considered under a variety of names like rent stabilization, rent regulation or anti-price gouging to fit the political objectives of the introducing policymaker. Despite their name, however, their effects are still largely the same. While six states and D.C. have statewide rent or local rent control in place, the vast majority of states preempt, or prohibit, the adoption of rent control laws.

Despite decades of economic research laying out the harmful effects of this policy, further reinforced by a recent literature review, legislators across the country have not put down the torch. By implementing a price ceiling through rent control, housing providers become unable to set rents at a level commensurate with actual operating costs. Further, cities with rent control like St. Paul have seen stark declines in housing supply production. NAA-commissioned research found that over 70% of housing providers say rent control has a significant effect on decisions core to their operation, including whether to withdraw from the market altogether.

Further, NAA released a research report in June 2024 that revealed how rent regulation stifles housing providers’ ability to properly maintain their properties. This report builds on existing research which highlights the razor-thin margins of the rental housing market with 93 cents of every rent dollar going towards operational costs including maintenance, repairs, and property taxes.

2024 Review

Across the country, policymakers continued to consider rent control at all levels of government, with most of the proposals aiming to adopt or expand rent control in their jurisdiction. These 218 tracked bills were spread across 32 states in places one would expect like California and New York, but nearly every state saw rent control proposals considered in some way.

Here are some of the largest policy proposals considered this year:

• Colorado HB24-1259 limits rent increases to the higher of the previous year’s increase or 10 percent for two years following a declared disaster. This bill creates a loophole in the state’s current preemption of rent control, and was signed by the Governor on June 5, and became effective immediately.
• Rhode Island HB7049 would limit rent increases to 4 percent in a twelve-month span, and requires a 30-day written notice of rent increase. Further, violation of this provision would result in a housing provider paying the resident the equivalent to three months’ rent in addition to any damages sustained by the resident. This bill was discussed in committee and ultimately held for further study on March 27.
• A ballot initiative in California, Proposition 33, decided the fate of rent control in the state. The ballot measure did not pass, with a vote count of 8,570,352 No to 5,640,719 Yes. Current state law restricts the increase of annual rent to the lower of 5 percent plus the inflation rate, or 10 percent. Local governments are allowed to implement their own, more stringent rent control policies, but current state law exempts certain properties from regulation, including single-family homes and units built after February 1, 1995. Advocates campaigned to repeal these exemptions in the November election, and cities like San Francisco preemptively passed legislation to expand rent control in the city.

This past election, a host of ballot initiatives were considered by state and local jurisdictions across the country. You can see the results of these measures by visiting NAA’s Ballot Measure Tracker.

Only 11 of our tracked bills repealed, prohibited or weakened rent control at the state level. One notable industry win from this list was in Idaho, which passed a sweeping bill preempting local jurisdictions from enacting their own rent control policies as well as preempting local governments from requiring housing providers to participate in a federal housing assistance program.

 As we look toward the new year, a few states stick out as places to watch in 2025:

• California
• Colorado
• Illinois
• Maryland
• Michigan
• Nevada
• New Jersey
• Pennsylvania
• Virginia
• Washington

NAA’s Role

With rent control proposals percolating across the country, NAA and our state and local affiliate partners have been steadfastly working to keep these proposals from becoming policy. At the federal level, the Biden Administration unveiled a plan to cap rent increases at 5 percent or to risk losing certain tax incentives. In response, NAA continued to advocate to the White House and Congress. NAA President and CEO Bob Pinnegar sat down with CNBC’s Brian Sullivan and former Vermont Governor Howard Dean to discuss the dangers of a federal rent control policy. Watch the full interview here.

The Chicagoland Apartment Association has been at the apex of advocacy through a coalition known as Supporting Housing Affordability, Progress and Equality (SHAPE Illinois). This year, the group has been tirelessly working to defeat numerous bills poised to repeal the state’s rent control preemption. They effectively utilized a grant from NAA to enhance their advocacy campaign and have since prevented any of these bills from reaching a floor vote.

Maryland saw multiple actions on rent control with a major ordinance being considered by the Prince George’s County Board. The Apartment & Office Building Association (ABOA) of Metropolitan Washington was a steadfast opponent to the proposal to make the temporary cap on rent increases of 3 percent permanent. AOBA worked tirelessly in a robust advocacy campaign which resulted in significant changes to the bill capping annual rent increases to 6 percent instead of the originally proposed 3 percent.  

Through the strong support of NAA's Housing Affordability Grant Program (HAP), we uplift our state and local affiliates' advocacy efforts to curb rent control policies as they continue to crop up across state legislatures and city councils. NAA is steadfast in its commitment to protect the industry from bad policy, continuing our partnership and support of the Housing Solutions Coalition, a group comprised of national, real estate trade associations, such as the National Multifamily Housing Council and Mortgage Bankers Association. In our second year as a coalition, we have laid the foundation to fight these detrimental policies across key jurisdictions and advocate for policies to increase the supply of housing across the nation.