President Biden on Tuesday proposed eliminating tax breaks for landlords who raise their tenants’ rent more than 5 percent each year, as part of a larger effort by the administration to lower housing costs.
The president called on Congress to pass legislation that would bar corporate landlords who raise rent more than 5 percent a year from taking advantage of accelerated depreciation write-offs.
The proposed rule would apply to landlords with over 50 units, which would cover more than 20 million units or about half the rental market in the country, according to a fact sheet from the administration.
“Families deserve housing that’s affordable—it’s part of the American Dream,” Biden said in a statement. “Rent is too high and buying a home is out of reach for too many working families and young Americans, after decades of failure to build enough homes. I’m determined to turn that around.”
“Today, I’m sending a clear message to corporate landlords: If you raise rents more than 5%, you should lose valuable tax breaks,” he continued.
“While the prior administration gave special tax breaks to corporate landlords, I’m working to lower housing costs for families,” Biden added. “Republicans in Congress should join Democrats to pass my plan to lower housing costs for Americans who need relief now.”
The rent cap, which would be in place for two years under Biden’s proposal, is meant to “serve as a bridge until more housing units are built,” National Economic Advisor Lael Brainard told reporters on a call Monday.
In order to avoid discouraging new housing supply, it would not impact new construction or units that have undergone substantial rehabilitation, Brainard added.
The Biden administration is also leaning on agencies to repurpose federal land to build more affordable housing. The Bureau of Land Management (BLM), United States Forest Service (USFS) and United States Postal Service (USPS) have all announced plans to repurpose extra land or properties for housing.
“My Administration is also taking action to cut red tape and repurpose public land to build more affordable homes—including thousands of new homes in Nevada—and announcing new grants to build thousands of homes from Las Vegas to Syracuse,” Biden said.
The president is currently in Las Vegas, where he is set to deliver remarks at the NAACP National Convention and the UnidosUS Annual Conference.
