Biden push for national rent control will turn would-be landlords into Airbnb hosts
Washington Examiner
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The coronavirus pandemic was hard on many people. Schoolchildren lost not just months but years of learning. Parents, especially mothers, could not work because teachers unions would not let schools reopen. Many workers who could not do their jobs remotely lost those jobs through no fault of their own.
Landlords were hit very hard. They had to deal with a national moratorium on evictions, which President Joe Biden, seeing it as another way to bribe voters, extended illegally long after it had served its purpose. The moratorium put landlords at the mercy of their tenants. Small and independent landlords struggled to pay their mortgages and maintenance bills because tenants stopped paying rent.
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Landlords who sold their investment properties before the pandemic began were the winners. Another smart move was to stop leasing properties altogether and instead get into the business of short-term home-sharing using apps such as Airbnb and Vrbo. The harder government makes it to lease a place to a tenant, the better home-sharing looks in comparison. It could bring in a higher revenue per day, its users are likely to respect the space and also to leave after a short stay, and there is almost no government red tape involved, unless you live under sclerotic and oppressive administrations such as Washington, D.C.
Apparently, the Biden administration wants more landlords to leave the rental market for the vacation market when rental housing is already in short supply. It would fit a pattern of Biden worsening shortages and pushing up prices. Naturally, since Biden is drawn to bad policy as ineluctably as a moth to a lamp, he is now proposing a form of national rent control.
The White House announced executive actions last month in conjunction with what it is calling a “Renters Bill of Rights.” It announced plans to “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 and tenant screenings, the provision of adverse action notices by landlords and property management companies, and how an applicant’s source of income factors into housing decisions.”
The average landlord has been cheated out of thousands of dollars in rent at some point in his business past by unscrupulous tenants. He or she needs federal micromanagement of tenant screening the way he needs a hole in his head.
But it gets much worse. Biden’s minions describe in vague language how the Federal Housing Finance Agency will be looking for new ways to “limit egregious rent increases” on properties backed by Freddie Mac and Fannie Mae. If the mortgage of your rental property ends up in the hands of one of those quasi-government enterprises, you might soon find yourself subjected to a national rent control policy.
Under the Constitution, there is no federal role in landlord-tenant relations. Biden’s attempts to create a national rental code is an end run around citizens’ economic freedom and a distressing development for people who provide a vital service and are already reeling from government lockdowns.
If you are thinking of purchasing an investment property to lease, or of leasing a property you own, you should probably think twice. Biden has just added a new layer of uncertainty to your business idea.
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