House for Rent
At tonight’s work session, the Council will discuss a draft ordinance prepared by the City Attorney to continue the rent stabilization program for an additional five years.
Unless renewed, the program will expire on September 1.
In addition to the extension of time, the new draft ordinance makes a number of changes to the current program based on comments from the Rent Stabilization Board:
- It updates the Ordinance to require that rental rates that existed before the rent stabilization program began in 2005 may only be applied if the property has been a rental continuously since then, requires registration of the property within 60 days of it becoming a rental,
- increases the rent cap from 0.6% of the assessed value of a property to 0.8% of the assessed value for single-family dwelling units,
- makes some minor procedural changes to the procedure for requesting an upward adjustment of the rent cap, and
- eliminates certain enumerated factors listed in determining whether to allow an upward adjustment of the rent cap, allowing the Rent Stabilization Board to consider any relevant factors..
There will still be a public hearing on the rent stabilization program on a date yet to be determined, and the Council will vote on the ordinance at the official meeting on July 10, 2012.
William Young
Dear Mr. Kabir: I watched the debate about rent stabilization with great interest. I have two concerns:
1) There is no explanation of how the cap in rent was determined. Why is it .6% rather than .8%? Why shouldn’t it be 1%? The cap seems to be chosen arbitrarily. If the cap is too low it will have negative effects on property values that can also discourage owner-occupancy. If the cap is too high it won’t prevent investors from buying rental properties. Is there a scientific basis for determining just what the cap should be? Or has the city council just chosen a figure at random, reasoning that “we can apply it now and see what happens.” Is this an experiment? If so, please don’t forget that some people in College Park could be harmed by this experiment.
2) The argument that landlords and renters are “pushing out” long-term residents is not based on a scientific understanding of the data.
a) Proponents of rent stabilization have used the data presented in the report by the Sage Policy Groups, Inc. to support their argument. The data in this report show that the percentage of owner-occupied housing in College Park has fallen during the past 10 years, even though the percentage of owner-occupied housing in Prince Georges Country has risen. However, we cannot conclude from this that landlords and renters are “pushing out” long-term residents who live in the houses that they own. There are other factors that also discourage home owners from living in their properties in College Park: 1) heavy traffic congestion caused by the intersection of Baltimore Avenue with Highway 495; 2) higher crime rates caused by the presence of two Metro stations in College Park (Metro stations attract criminal activity, since criminals can reach College Park to steal from students late at night and then quickly leave the area on the Metro); 3) higher crime rates due to the presence of the U of Md Campus (which is also a magnet for petty criminals). None of these factors would be affected by rent control.
I have anecdotal evidence about the importance of the crime rate. I know a mechanic who has worked at the Maaco auto shop on 51st Place for twenty years. When he was first hired he was living 3 blocks from the shop. But after he got married and started a family he moved to North Baltimore, because the crime rate there is lower and the schools are much better. Now he has a daily commute of 2 hours one-way, but for him the commute is worthwhile because of his concerns for his children. He is surely not the only ex-home owner who has left College Park because of crime in nearby Greenbelt and near the metro stations.
b) Another problem with comparing College Park to the rest of Prince Georges County is that the comparison does not control for housing affordability. Housing in other parts of Prince Georges County (ex. New Carrollton, Bowie, Cheverly, Hyattsville, Seabrook, Landover, etc.) is cheaper than in College Park, so of course in these communities the percentage of owner-occupied housing would be higher. To be sure that the decline in owner-occupied housing in College Park is not partly caused by increased prices, you have to compare owner-occupancy rates in College Park with owner-occupancy rates in a community where housing prices are about the same.
So even though I am not a landlord I am not convinced by the arguments in favor of rent control. I think the best way to improve quality of life in College Park is to hire more police and fight for improvement of traffic on Baltimore Avenue.
Also, if the Purple Line is built some of the traffic congestion will be relieved and College Park will become more attractive for owner-occupied housing. But the Purple Line will also bring more crime, so extra police must be hired. I am in favor of the Purple Line in spite of this; it will improve traffic congestion in College Park. I hope you also support the idea of the Purple Line.
Thanks very much for your time and consideration.
Truly yours,
Bill Young
docyoung51@hotmail.com