President Biden on Tuesday proposed eliminating tax breaks for landlords who raise renters’ rent by more than 5% annually as part of his administration’s larger effort to lower housing costs.
The president called on Congress to pass a bill that would prohibit corporate landlords who increase rents by more than 5 percent per year from taking advantage of accelerated depreciation.
The proposed rules would apply to landlords who own 50 or more properties, covering more than 20 million properties, or roughly half of the nation’s rental market, according to an administration fact sheet.
“Families deserve affordable housing – it’s part of the American dream,” Biden said in a statement. “Decades of failing to build enough housing have left rents too high and homebuying out of reach for too many working families and young Americans. I’m determined to change that.”
“Today I send a clear message to corporate landlords: if you increase rents by more than 5 per cent you will lose your valuable tax incentives,” he continued.
“While the previous administration gave corporate landlords a special tax break, I’m working to lower the cost of housing for families,” Biden added. “Republicans in Congress should join Democrats and pass my plan to lower the cost of housing for Americans who need relief now.”
The rent caps in Biden’s proposal, which would apply for two years, are intended to “serve as a stopgap until more housing is built,” national economic adviser Lael Brainard told reporters on a conference call Monday.
Brainard added that the changes would not affect new homes or those that have undergone significant renovations, to avoid stifling new housing supply.
The Biden administration is also pushing government agencies to repurpose federal lands to build more affordable housing. The Bureau of Land Management (BLM), the U.S. Forest Service (USFS) and the U.S. Postal Service (USPS) have all announced plans to convert excess land and properties into housing.
“My administration is also taking steps to cut red tape and repurpose public land to build more affordable housing, including thousands of new homes in Nevada, and I’m 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 scheduled to speak at the NAACP national convention and the UnidosUS annual conference.
