Industry Prepares to Fight Minnesota Rent Control Initiative
Two initiatives on the ballot in Minneapolis could pave the way for future rent control measures.
This November, residents of Minnesota will vote on ballot initiatives that could expand rent control.
Jim Lapides, vice president of strategic communications for National Multifamily Housing Council, says this is “perhaps one of the most draconian rent control measures in the nation.”
A St. Paul ballot initiative proposes to cap all rent increases for all rental housing at 3%. It makes no exception for the year of construction or product type. “This initiative would even apply to vacant units, therefore capping the price of a unit forever,” Lapides writes. “This would be perhaps the strictest rent controls anywhere in the country and devastate the rental housing market.”
Two initiatives on the ballot in Minneapolis could pave the way for future rent control measures, according to Lapides. One measure would let citizen groups write rent stabilization policies and allow them to put those proposals before voters as a ballot initiative. The second initiative would let the city council write rent stabilization policies. Then they could pass them or put them before voters.
Lapides says that research shows these rent control measures usually don’t provide the intended relief. Instead of improving affordable housing availability, these laws often exacerbate shortages and cause existing buildings to deteriorate.
“In addition, the introduction of these measures come on the heels of months of market uncertainty brought on by pandemic-related financial distress,” Lapides writes. “ If enacted, these measures could result in even further instability for Minnesota’s renters and the rental housing market at large.”
Lapides says it’s important for the industry to push back on these initiatives and pursue other alternatives, like voucher-based assistance, that better address affordable housing shortages.
The ballot initiative comes at a time when apartment rents have recovered from their drop during the pandemic and are surging in many areas outside of gateway markets. Minneapolis is among those cities that have posted rent increases for five consecutive or more months.