Landlords will face greater federal scrutiny from the Consumer Financial Protection Bureau, Federal Trade Commission and other agencies amid rapidly rising rents under a plan that President Joe Biden released Wednesday.
The plan, described as a blueprint, along with actions by federal agencies, are meant to “advance a stronger, more equitable renter market,” the White House said. “Renters should have access to housing that is safe, decent and affordable and should pay no more than 30 percent of household income on housing costs.”
Progressive Democrats in Congress, including Massachusetts Sen. Elizabeth Warren and New York Rep. Jamaal Bowman, praised the plan directing the CFPB, FTC, Department of Housing and Urban Development, government-backed enterprises and other agencies to enhance renter protections and crack down on unfair practices.
“For too long, corporations have had free rein to raise rents unchecked, price gouging families and raking in record profits,” Warren and Bowman said in a joint statement. “And for too many families, skyrocketing rental costs keep safe and affordable housing out of reach. We need real action now, and we owe it to families to pursue all options on the table to address the housing crisis and lower the cost of rent.”
The two lawmakers urged the president in a letter this month to take action to rein in rising rents. According to the White House, rents increased 26 percent during the pandemic.
The administration tapped the FTC and CFPB to gather information about and explore actions the FTC could take against unfair practices that stop consumers from getting and keeping housing.
The White House also took aim at tenant background screening practices and companies, directing the CFPB to issue guidance to ensure the screening companies follow the law and use accurate credit information. HUD, the Federal Housing Finance Agency, FTC and Agriculture Department will also work with the CFPB to issue best practices for tenant screening.
Biden’s framework directs the Federal Housing Finance Agency and the government-sponsored enterprises it oversees to explore the possibility of incorporating renter protections into federally backed mortgages, including restrictions against “egregious rent increases.” The enterprises, Fannie Mae and Freddie Mac, buy and repackage mortgages as mortgage-backed securities to provide liquidity to the housing credit market.
The White House also directed HUD to propose a rule that would require landlords to give tenants 30 days notice of an eviction in federally subsidized housing. The requirement was established by the 2020 pandemic relief law and was implemented by an interim HUD rule.
The Federal Housing Finance Agency along with the government-sponsored enterprises committed to publishing a database that allows tenants to search whether their property has a federally backed mortgage and must provide a 30-day notice.