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County rent cap could have low impact

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Posted on: July 10, 2024


Many Route 1 apartment buildings will not be subject to an expected Prince George’s County rent cap because they were built after 2000.
PHOTO CREDIT Hannah Frasure

Up to 65% of apartment buildings in College Park could be exempt from a 3% rent cap that the Prince George’s County Council is poised to approve this month.

The measure would cap rent hikes at 3% a year, plus the rate of inflation, up to 6%. However, buildings constructed after 2000 would be exempt from the law.

“My takeaway personally, and at the first swipe of it, is that because of all the new construction that really boomed since 2012, that we’re going to have a very small or very little effect on the 3% cap,” Michael Williams, the city’s economic development director, told College Park Here & Now

He added, however, “I’m not saying this 3% cap is not important and significant to the individuals that it’s going to affect.”

Those individuals include up to 35% of apartment dwellers as well as some tenants of single-family homes, townhomes and duplexes, as their landlords will have to comply with the 3% cap. 

Exempt from the cap are Prince George’s County residents who rent out fewer than five units; homeowners living in the house and renting out part of the space; and owners of senior housing properties.

According to a College Park Here & Now analysis of data from the 2020 U.S. Census and the 2018-2022 American Community Survey, 2,978 of the city’s 4,589 multifamily structures with at least five apartments were built after 2000. 

“With all of the exemptions that the [law would] offer … you’re not going to get much of a number of families or individuals that this is going to affect because now, as you know, just walking through College Park, everything … seems like it’s, you know, brand new or newer,” Williams said. 

Michael Bodaken, a member of the Prince George’s County Council’s Rent Stabilization Working Group, suggested the rent cap would not dissuade developers from building new apartment buildings in College Park because it does not apply to new construction.

“Wherever rent stabilization is adopted and where new construction is exempt, then there hasn’t been any impact on building whatsoever,” Bodaken, an adjunct instructor at the University of Maryland’s (UMD) School of Public Policy, said.

County Councilmember Eric Olson (District 3) said the council worked “toward a fair compromise that will achieve all the goals that we want: protecting tenants from, you know, outrageous gouging and that kind of thing, while also making sure that what we do doesn’t inhibit investment in the county.”

Investment in multifamily buildings, like the ones that have sprung up by the dozens on Route 1 over the past decade, account for 76% of all revenue from property in College Park, according to the city’s Office of Economic Development.

“Newly constructed, large multifamily properties have an outsized importance to College

Park’s tax base,” according to the City of College Park Five to Ten-Year Economic Development Strategy.

Griffin Benton, vice president of government affairs with the Maryland Building Industry Association, said the organization’s members oppose any law capping rent increases.

“Our position on rent control is we do not support it. We’re against it as a policy entirely,” he said. The association’s membership includes a number of College Park landlords.

Benton noted that rent caps can encourage landlords to raise rent to meet the caps, even if they might have made more modest increases otherwise.

He claimed the 6% rent cap passed in Montgomery County last year led landlords to raise rents. Caps usually encourage landlords to increase rents “to that max [cap]” every year, he said.

In addition, Benton said, rent caps will not address the problems tenants most often bring up when advocating for them, like dilapidated housing, mold, broken appliances and health issues.

“It’s going to, if anything, I think, make some of those landlords be less inclined to spend money,” Benton said. “Long-term it’s going to be more expensive for tenants to live in those units. … It may be a temporary stop gap. Maybe there’s a time when … in terms of trying to actually make it cheaper to live, it’s doing the exact opposite.”

One property manager said a rent cap could lower the chances that his company would acquire additional rental units in College Park.

Quinn Rounsaville is senior vice president of acquisitions at Washington Property Co., which owns three multifamily buildings in College Park: Smith Manor, University Gardens and Columbia Manor. 

“In general,” he said, “as an investor, we would steer away from jurisdictions that have permanent rent control for multifamily housing.”

However, UMD graduate research assistant Andrew Goffin said a temporary rent cap the county council enacted in 2023, coupled with a moratorium on rent increases during the pandemic, prevented him from having to move out of his apartment in Westchester Tower, which he has rented for three years.

“I mean, I looked at how much my rent increased this year for Westchester, and … they got as close to 3% as they possibly could,” Goffin said. “Based on that, I can just presume … they would have increased a little more if they could have.”

Richard Birch, an undergraduate UMD student who rents at Hub College Park, on Knox Road, said he supports a rent cap.

“I could easily be in the position of someone who has to pay high costs of rent and barely [has] the means to afford it,” Birch said, as Hub College Park, constructed in 2020, is exempt from the new law.

College Park had rent control from 2005 to 2014, according to Mayor Fazlul Kabir, who noted the city has no plans to adopt its own ordinance.

“I’m not hearing it, you know, even in private,” Kabir said.

The county council has scheduled a public hearing on the rent cap proposal for July 16.

  • Median monthly rent in College Park is $1,730. After accounting for inflation, the median rent in College Park has increased by an estimated 26%, or $357, since 2000. 
  • 58% of renters in College Park report they are rent-burdened, which is in line with national statistics. In 2000, 54% of renters in College Park said they were rent-burdened.
  • More dwellings in College Park are renter-occupied than owner-occupied, even when excluding UMD’s on-campus housing. In 2000, a majority of occupied housing units in College Park were owner-occupied (57%), but the percentages have flipped (now, 63% of housing units are renter-occupied.) 

Source: College Park Here & Now analyzed data from the 2000 U.S. Census, the 2022 American Community Survey 1-Year Data, and the U.S. Bureau of Labor’s Consumer Price Index for All Urban Consumers in Washington-Arlington-Alexandria, DC-VA-MD-WV for 2000-2022



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