The White House released a Blueprint for a Renters Bill of Rights last month.
According to the White House, the goal of this document is to articulate key principles of resident-centered housing to help renters across the country.
In addition to releasing this document, the administration detailed several new actions that government agencies will take to strengthen tenant protections and avoid unnecessary evictions.
They also launched a Resident-Centered Housing Challenge to encourage Congress, state and local lawmakers, and private housing actors to improve or adopt practices that promote fairness and transparency in the rental market.
Key Points
The key points of this bill of rights include:
- Safe, Quality, Accessible, and Affordable Housing: Renters should have access to housing that is safe, reasonably maintained, and affordable.
- Clear and Fair Leases: Renters should have a straightforward and fair lease that clearly defines rental terms, rights, and responsibilities.
- Education, Enforcement, and Enhancement of Renter Rights: Federal, state, and local governments should do everything in their power to ensure renters understand their rights and protect renters from unlawful discrimination and exclusionary practices.
- Right to Organize: Renters should have the freedom to organize without obstruction or harassment from their landlord or property manager.
- Eviction Prevention, Diversion, and Relief: Renters should be able to access resources that help prevent and avoid evictions, ensure the legal process during eviction proceedings is just, and avoid future housing instability.
The principles here aren’t new; they’re building on things that have been on the government’s radar for a while. The Blueprint is the result of a long process in collaboration with several federal agencies.
Key Action Items
The White House also detailed some action items that will help make the aforementioned goals a reality. Let’s look at a summary of those below:
- The Federal Trade Commission (FTC) and Consumer Financial Protection Bureau (CFPB) will gather information to determine practices that unfairly prevent applicants and tenants from accessing or remaining in housing. This will impact enforcement and policy under each agency’s jurisdiction. The FTC hasn’t explored unfair rental practices in the past.
- The Consumer Financial Protection Bureau will provide guidance and work with the FTC to ensure accurate information in the credit reporting system. They will also work to hold companies that run background checks accountable if they use unreasonable procedures.
- The Federal Housing Finance Agency (FHFA) will launch a new public process to study proposed actions promoting renter protections and limits on untenable rent increases for future investments. Furthermore, the FHFA will promote affordability in the multifamily rental market by establishing requirements that facilitate the financing of multifamily loans to guarantee reasonable housing.
- The US Department of Housing and Urban Development (HUD) will propose a new rule requiring public housing authorities and owners of project-based rental assistance properties to give at least 30 days’ notice before terminating a lease due to nonpayment of rent.
- The White House will hold quarterly meetings with tenants and tenant advocates to listen and make sure these groups have a seat at the table to share new ideas to strengthen tenant protections.
It’s important to mention that the White House didn’t issue any mandates to go along with the release of this document. Many of the agency commitments within the Blueprint reflect agency initiatives that have been in process already.
What about HUD and the Treasury Department?
HUD and the Treasury are historically the two largest government agencies involved with federal housing. Many analysts and others don’t think their major commitments and efforts fully addressed some of the more pressing issues that tenants and tenant advocates have brought to the government’s attention.
- Let’s start with the Treasury. The Blueprint espouses best practices by state finance housing agencies, but doesn’t call for regulation, or information gathering in support of regulation, by the Treasury over issues related to the Low Income Housing Tax Credit (LIHTC) program. The main takeaway regarding the Treasury is its promise to congregate with tenants, advocates, housing providers, and researchers about tenant protections within LIHTC.
- HUD made a couple major commitments that could lead to powerful policy changes but will require active monitoring by advocates. The main commitment is to release guidance addressing the fair housing implications of tenant screening algorithms. HUD also promises to hear out advocates and the public on ways to improve Section 504 regulations and accessibility standards for HUD-assisted facilities.
Potential Impacts
One of the major impacts of this document is the protection of renters from eviction without cause. This initiative could provide renters with increased stability regarding renting and stop landlords from evicting tenants without just cause.
Furthermore, the provision of access to legal counsel for renters facing eviction is another part of the document that could help. Renters will have an easier time dealing with the legal system and protecting their rights if a knowledgeable lawyer assists them.
However, once you’ve read the document, it’s clear that the blueprint is more about investigating misconduct and ensuring best practices than any concrete action or rulemaking.
Commenting on the Blueprint, BiggerPockets CEO Scott Trench said, “It’s hard to find any new actions of consequence in the [Blueprint] that aren’t items like a ‘request for information,’ ‘investigation,’ ‘process to conduct stakeholder outreach’ or ‘workshop,’ unless it is directing actions within government-controlled programs like HUD, USDA, or GSEs like Freddie Mac.”
What about rent control? The document never explicitly mentions it. Instead, it talks about how rent should remain “reasonable.” But reasonable isn’t defined explicitly. And we all know rising rent prices continue to cause financial stress for many tenants.
That said, while the consumer price index does reveal accelerating rent inflation, it is a delayed indicator of actual rent prices. The Zillow Observed Rent Index shows that rent prices have fallen recently. In particular, the fall from October 2022 to November 2022 was the most aggressive decline in the seven-year history of the Index.
Additionally, 565,200 new rental units are scheduled to come online before the end of the year. That’s the largest number of new apartment deliveries in decades. This hefty forecast is mostly due to the construction delays caused by the pandemic.
Despite dropping rents and additional units, rent is still up 8.4% from last year, and the average renter is having a hard time. The greater number of units also doesn’t indicate lower rent prices year-over-year.
The blueprint doesn’t directly impact rent and rent control yet, but it could kickstart things. It’s in everyone’s best interest to keep an eye out for what happens next.
Conclusion
While the Blueprint may not have an immediate impact on tenants, it’s important to be aware of its existence. This could signal things to come in the rental industry.
Check out our tenant renting guide for helpful renting tips!
