I’ve been following the issue of rent control lately after the city decided to take it for public hearings. The first of the two scheduled public hearings took place last Tuesday. The City council will vote on new rent ordinance by end of the month.
According to The Gazette, the ordinance currently bars residential landlords from collecting monthly rent greater than 0.6 percent of a home’s assessed property tax value, although the law is not currently enforced. Under the system, a landlord who owns a house with an assessed value of $300,000 would be barred from collecting more than $1,800 per month from its combined tenants.
In the 2010 assessment, the assessed values of these homes plummeted, meaning that 0.6% of the assessed value is now significantly lower than the fair market rent for most properties. The 2010 Fair Market Rent in the D.C. Metropolitan area for a four-bedroom unit is $2,522/month.
Councilman Robert Catlin (Dist. 2) proposed at a March 16 work session that the council lift the cap to 0.8 percent, due to declining property tax values.
The idea of rent control is nothing new. Almost every city and municipality has a committee called rent stabilization board or committee that oversees the issue and recommends the city on how much maximum rent the homeowners can charge.
The rent control makes the houses in the city affordable for the tenants. A higher rent forces the low income family move out of the community which may adversely affect the community through “social unbalance”. The frequent relocations of such families across school district have also further impact on their children’s education.
However the property owners think such a control inhibits their ability to maintain and improve their rental properties. Without such improvements, the community becomes “a slum” – they claim. Opponents of rent control also argue that rent of houses should be decided by the competition in the housing / rental market.
As expected, most UMD students always have supported stricter rent control legislation favoring a lower monthly rent. UMD students make the significant portion of the city’s tenant population.
Aside from the intricacies of the law, a subtle cultural issue surrounding this debate can be noticed – students / tenants typically call the property owners as “landlords”, a term many property owners have a deep dislike with. The headline of last Tuesday’s rent control public hearing story in the UMD student paper the Diamondback reads “Landlords mobilize against rent ceiling“