By Adam Pagnucco.
Rent control has proven to be an all-out disaster for Montgomery County’s multifamily construction market. With almost four quarters of rent control now in the books, average quarterly multifamily permits have dropped by 96%.
Last summer, data released by the county’s Planning Department showed that during the first three quarters in which the county’s rent control law was fully in effect (2024 Q4, 2025 Q1 and 2025 Q2), MoCo’s number of multifamily units permitted were 8, 7 and 23. In the seven preceding quarters, the number of multifamily units permitted ranged from 284 to 1,240, marking an all-out collapse. And while MoCo’s multifamily production had nearly stopped, most other large jurisdictions in the region were producing hundreds of units with three (D.C. and Fairfax and Loudoun counties) topping a thousand.
A newer batch of data from the Planning Department includes the first two months of 2025’s third quarter (July 1 through August 31). In the latter period, 54 multifamily units were permitted. The chart showing pre- and post-rent control multifamily unit permits is shown below.
Planning staff commented:
This issue includes the most up-to-date permitting data available, which extends through August 31, 2025, two-thirds of the way through the third quarter. Permitting activity remains slow, and the only multifamily permits in this span was 54 units that are part of the 55+ Village at Cabin Branch project.
Similarly, the 38 total multifamily units permitted in the fourth quarter of 2024 through the second quarter of 2025 are “two-over-twos,” which are for-sale units, similar to townhomes but counted as multifamily because they fall under commercial building codes.
The Village at Cabin Branch includes both condos and rental apartments. The report does not make clear which kind of unit was permitted.
Let’s do some quick math. In the seven quarters prior to rent control, an average of 582 multifamily units were permitted per quarter. In the nearly four quarters with rent control in effect, an average of 23 units were permitted per quarter. As of this writing, that’s a drop of 96 percent.
Now let’s compare us to the rest of the region. The Planning Department used U.S. Census Bureau data to estimate multifamily permits by jurisdiction from October 1, 2024 through August 31, 2025. Almost all of our large neighbors permitted hundreds of units or more while we permitted almost nothing.
The mechanics of how this is happening are well known to county leaders. Soon after rent control was approved, apartment building transactions collapsed. The nation’s financial community has redlined MoCo for rental housing project financing and developers have told planning staff that rent control prevents them from getting project funding. Political uncertainty further discourages housing construction as rent control supporters try to rewrite history and a leading county executive candidate has publicly told developers “don’t come here.”
Rent control doesn’t mean the end of all housing construction. Developers are still building for-sale housing although they are increasingly seeking tax breaks and tax increment financing to do it. The county subsidizes affordable housing projects with nonprofit developers, any of which could cause a temporary spike in permits, but the cost to taxpayers of these projects is substantial. The real impact of rent control will not be to stop housing altogether but rather to prevent the county from building enough units to end its increasingly dire housing shortage.
Rent control is a historic failure that was created by myopic politicians and the taxpayer-funded lobbying groups who demanded it. Who will step up, recognize reality and say enough is enough?