By Adam Pagnucco.
Advocates for rent control often say that such policies reduce homelessness and evictions. That was a major claim made two years ago, when the Montgomery County Council voted to approve rent control on a 7-4 vote. Here are a few sample statements from advocates.
“Elected officials should stop at nothing to protect renters recovering economically from the pandemic and stave off homelessness, and this bill seeks to accomplish that.” Alex Vazquez, CASA lead organizer for Montgomery County.
“Adopting the HOME Act would provide an immediate tool to curb the County’s current crisis of evictions, displacement, and homelessness.” Christopher C. Cano, Coordinator for Member Political Engagement, SEIU Local 500.
“We know rent stabilization is a proven policy that can rapidly stabilize prices, halt rent gouging, and reduce the risk of displacement and homelessness, while increasing housing security and affordability over the long term.” Council Member Kate Stewart.
“An annual limit on rent increases, also known as rent stabilization, is an essential and immediate tool to curb the county’s current crisis of evictions, displacement, and homelessness.” Mara Greengrass (Jews United for Justice), Ingrid Fichtenberg (Democratic Socialists of America), Kush Kharod (Everday Canvassing) and Alex Vazquez (CASA).
Similar testimony can be found here.
So what happened since the law was passed? Homelessness and evictions have increased.
Last month, the county council’s Health and Human Services Committee was briefed on trends in homelessness in evictions. The staff analysis found a continuing increase in the county’s homeless population since 2022. Rent control was passed in 2023 and took effect on July 23, 2024.
Furthermore, MoCo is a regional outlier. No other large jurisdiction in the region came close to matching MoCo’s huge increase from 2024-25, and several (including D.C.) saw reductions in homelessness.
It’s worth noting that MoCo’s collapse in multifamily building permits makes it an outlier both nationwide and in the State of Maryland.
The report also shows a long-term trend of rising evictions. Rent control was in effect for nearly all of FY25 and yet eviction writs received soared.
The report blames these factors for the above trends.
- Lack of affordable housing
- Wages not keeping up with inflation
- Large arrearages
- End of Covid emergency rental assistance
- Eroding safety net resources
- Domestic violence
- Vulnerability of household members
Here is another contributing factor: despite rising needs in the community, the number of households served by rental assistance has not changed much since FY22. This is despite multiple tax hikes two years ago.
The county’s non-competitive economy may also be a factor. Economic growth beefs up wallets and makes it easier to afford rent. We just don’t have much of it.
And so in the county’s first year of rent control, homelessness and evictions have soared while multifamily building permits have stagnated. So far at least, rent control advocates have been proven to be dead wrong. Will these trends continue?
Here’s an idea. How about repealing rent control, liberalizing zoning restrictions and calling a halt to punitive measures against the real estate industry, and then using a big chunk of additional property tax revenues from renewed housing construction to help vulnerable tenants? That would generate more units, possibly restrain growth in home prices and rents, boost tax receipts and put more money in tenants’ pockets, but it would require a greater understanding of market economics than most of our elected officials have demonstrated.
Instead, the county is seeing multifamily housing production slow down dramatically, a really bad idea when the homeless population is increasing. Where are homeless and evicted people supposed to live? In the absence of housing construction, which rent control laws have been shown to work against, homeless people have few places to go other than outside the county. Is that what progressives want?
So far, the impacts of MoCo’s rent control have all been negative and have made the county an international poster child for bad housing policy. Will the county’s rent control law ever demonstrate anything positive to offset its growing costs?