A blueprint for a Bill of Renters Rights announced by the White House has put investors and landlords on notice about harmful practices, while simultaneously aiming to promote rental affordability.
The new policy from the Biden administration may not affect every landlord directly but, as an investor, you should be aware of policy changes that could impact how you manage your investments.
Landlords have come in for a rough ride in recent months because of rising rents. It shouldn’t be forgotten the recent interest rate hikes by the Federal Reserve have stretched the finances of many investors and the surge in inflation has also hurt.
The reality is that additional financial pressures need to be reflected in the rental fees.
The Bill of Renters Rights is designed to promote “safe, quality, accessible, and affordable housing”, according to the White House statement. It will seek “clear and fair leases”, education, eviction prevention, and enforcement of these guidelines.
Here are some additional actions undertaken in Washington to promote affordable housing and protect tenants.
Fair information
Requests for information on unfair landlord practices have been issued by two government agencies – the Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB). These agencies will investigate how landlords (or their property management companies) check tenant backgrounds and what happens to that information.
Screening
The use of algorithms in tenant screenings is being scrutinized.
On notice
Other areas under the microscope include how an applicant’s source of income influences a tenancy decision, and the use of adverse action notices by landlords and property management companies.
Finance options
The Federal Housing Finance Agency (FHFA) is to encourage additional financing of multi-family loans. Freddie Mac and Fannie Mae purchased $142 billion of such loans last year to make more than 1 million homes available.
If you’re concerned about how these moves might affect you, I suggest you consult your property management company or seek legal advice.
With rents rising consistently across the United States, interest in investing in rental properties has been strong.
NOTE: The information in this article is general in nature and provided as a general overview only. Always consult your financial advisor or accountant for advice specific to your personal circumstances.
Landlords and investors provide a vital service to help deliver affordable housing to those who cannot, or do not wish to, buy a home.
If you’re looking to start or expand your property investment portfolio, I’d be delighted to talk with you. There are some excellent buying opportunities for apartments and houses in our neighborhood right now.
NOTE: The information in this article is general in nature and provided as a general overview only. Always consult your financial advisor or accountant for advice specific to your personal circumstances.