By Adam Pagnucco.
Recently, I broke the news that MoCo’s multifamily building permits had crashed from hundreds of units per quarter down to 8 units in 2024’s fourth quarter and 7 units in 2025’s first quarter. I also supplied data showing that MoCo’s multifamily collapse made it an extreme outlier both nationally and inside the State of Maryland. Now updated data has greatly reinforced those conclusions. How much more data must emerge for our elected officials to change course?
At today’s Planning Board meeting, planning staff briefed the board on the same economic indicators presented to the county council weeks ago. However, they had two new slides on building permits.
The first one shows MoCo’s units permitted by category from 2023’s first quarter through 2025’s second quarter. That latter quarter contains new data not seen by the council. The greatest variability is seen in the light blue bar, which is the number of multifamily permits. That number collapsed from hundreds per quarter down to 8, 7 and 23 in the most recent three quarters.
Staff noted that none of the 38 multifamily units permitted in the last three quarters were rentals – they were all for sale “two over twos,” which are four-story buildings with a two-story unit over another two-story unit. Staff told the board, “The big takeaway is that there is essentially no – there’s no for-rent multifamily, it’s been over nine months, we haven’t seen a permit for for-rental multifamily units.”
The next slide uses U.S. Census data to contrast MoCo’s multifamily permits to our neighbors in the region. It shows the number of units permitted in buildings with three or more units from October 2024 through June 2025.
The vast majority of our neighbors greatly exceeded us in housing production. Our fellow laggards include Prince George’s County (which also has a rent control law) and Alexandria City, which has long had the region’s weakest economy. The City of Rockville, which has six percent of MoCo’s population, has a separate permitting system and often sees huge variation in multifamily unit production ranging from hundreds of units per year to zero. Still, the city – which does not have rent control – permitted more multifamily units during this time than the county. One note – staff believes that the Census Bureau does not count two over twos as multifamily units, explaining why their count for us is zero while ours is 38.
Now a caveat. I don’t love the data produced either by the U.S. Census Bureau or the county’s Department of Permitting Services. Errors in that data resulted in significant controversy that I have previously covered. But for now, it’s all we have.
So what’s going on here? Jurisdictions in our region have more commonalities than differences. We are all subject to factors like interest rates, tariffs, inflation and expensive land costs as well as the predations of the Trump administration. (One more slide by staff showed that interest rates started dropping around the same time that MoCo’s multifamily permits fell through the floor.)
The biggest difference between the above jurisdictions relates to rent control. Montgomery and Prince George’s counties recently passed rent control laws. D.C. has had a weak rent control law for decades that exempts buildings constructed after 1975, covers less than half of its rental units and allows landlords to raise rents on vacant units by up to 30%. Despite its law, D.C. led the region in rent increases between 2010 and 2021. The other jurisdictions do not have rent control.
The cumulative record so far of MoCo’s rent control law is abysmal. Consider everything that has happened over the last two years.
Developers began canceling housing projects even before the county passed its law in 2023.
Apartment building sale transactions sharply declined.
National real estate financing providers have redlined MoCo, cutting off money to fund multifamily housing projects.
The CEO of one of the nation’s largest housing developers publicly condemned “Montgomery County rent control,” saying “we are unlikely to invest further in that area, in that state.”
News of our collapse in multifamily permits spread around the country, confirming the real estate industry’s negative perception of our rent control law.
Advocates predicted rent control would reduce homelessness and evictions, but both of those things increased after the law took effect.
Despite all of this, our county executive actually wants to tighten rent control.
And now this. We’re an outlier. We’re a pariah among the national real estate industry.
MoCo leaders have more excuses on rent control than Donald Trump has felony counts, but how many more facts do we need? We must change course on rent control. Or we will watch our multifamily rental housing production continue to wither away.