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tenant protections
The US Has a Housing Crisis, Not a Squatting Crisis
The real estate lobby is using its power to advance a flurry of anti-squatter bills to push back against tenant protections enacted in the early years of the Covid-19 pandemic. Lawmakers should not take the bait.
Aug 11, 2024
Alabama, Tennessee, and Florida’s new anti-squatter laws all went into effect in the last two months, the latest exhibit of the real estate industry’s influence in American politics. In this year alone, at least 10 states have considered legislation that revokes tenancy rights, making squatting—when someone moves into a vacant building or onto uninhabited land—a criminal matter instead of civil one.
While the fear-mongering around squatting started as a right-wing talking point, now anti-squatter bills have passed in several states with bipartisan support. Earlier this year, in New York, where Democrats dominate politics, Gov. Kathy Hochul and several state legislators took a victory lap after passing a budget bill that declared that squatters don’t have the same rights as tenants, and to support property owners statewide.
Some would assume that these legislative actions were taken in response to a threat of a mass takeover of homes in cities across the country. But in reality, as many experts have rightly pointed out, squatting is extremely rare. A threat does exist, which is why we’re seeing a rise in this legislation. It’s just not to property owners. It’s to the power of the real estate lobby.
The manufactured crisis around squatters is meant to distract from the fact that over half of Americans struggle to pay their rent or mortgage every month.
As outlined in a new report by the Private Equity Stakeholder Project and others, the real estate lobby is a sprawling, interconnected group of representatives from the top corporate apartment owners and managers in the country, who—by having members sit on each other’s boards—can tap into an enormous shared pool of resources that they’re using to destabilize communities across the country.
The lobby is using this power to advance a flurry of anti-squatter bills to push back against tenant protections enacted in the early years of the Covid-19 pandemic. This was a time when millions of people in the United States were kept in their homes thanks to policies like rental assistance expansion and foreclosure and eviction moratoria. For many of us, it was the first time we witnessed our country recognize the public health and economic value of keeping people in their homes. These protections made clear that regardless of race, class, or housing tenure, housing stability is the foundation for thriving communities.
Now, real estate industry groups, the second biggest lobbying spender in the U.S., are using anti-squatter legislation in a desperate attempt to undercut that progress. Capitalizing on America’s heightened anxiety about the housing crisis, they are scaring people into believing that tenant protections come at the expense of homeowners. Lawmakers should not take the bait.
At best, these bills are reactionary responses to a problem that doesn’t exist. At worst, they represent the worst of election season fear-mongering: anti-immigrant sentiment, dog-whistle racism, and calls for law and order. Look no further than the Florida attorney general’s celebration of legislation declaring that immigrants were taking over homes across the state, based on a viral TikTok. In reality, most states already have laws that address squatters adequately—it’s tenant protections that remain significantly weaker relative to property rights.
Advancing anti-squatter legislation is a slippery slope to eroding eviction protections passed during the last few years, and that’s exactly what the real estate lobby wants: They themselves refer to squatter legislation as “eviction policy.” Clearly, they are hoping to put legislators on a path to repealing hard-fought regulations to protect tenants by inferring a false equating of squatters (who live in vacant properties without legal agreements) and tenants (who legally inhabit homes with leases).The bills put any resident with tenant or ownership interest at risk of immediate displacement, often by a law enforcement agency, without the normal requirement of notice, proof, and judicial review before someone is removed from their home.
But their efforts to undo these gains won’t be easy, because the tide has turned in support of tenant protections as a way to address our housing crisis. In poll after poll, people in the United States say they want to see governments take action to alleviate the cost of housing. This has quickly become a front-burner issue for Americans and a top priority for them in the presidential election, only second to inflation. A recent survey of voters in battleground states found that 82% of renters believe that, if addressed, the cost of rent and housing would make their personal situation better.
The manufactured crisis around squatters is meant to distract from the fact that over half of Americans struggle to pay their rent or mortgage every month. And that a tenant-led movement to change this reality is building political power, winning local elections, and influencing federal policy.
Considering this, one can see why the real estate lobby, which amassed over $2.5 billion in revenue during the height of the pandemic, is grasping at straws to stay relevant to legislators. While it’s trying to ramp up efforts to unravel tenant protections, the lobby itself—the National Association of Realtors (NAR)—is unraveling. From Department of Justice investigations and anti-trust lawsuits to sexual harassment allegations, and a musical chairs of presidents and CEOs in the last two years, members are not happy. In October 2023, Redfin announced it would require many of its brokers to cancel their NAR memberships and stop paying dues. Reports of NAR running out of liability insurance coverage and rumors of real estate moguls starting alternative associations show cracks in a foundation that will be difficult to repair. No amount of fresh paint, even if it is in the form of throwing tenants under the bus, can fix such dysfunction. But they’ll try as long as they can.
As America increasingly becomes a nation of renters, lawmakers can’t lose sight of the bigger picture: We have a housing crisis, not a squatter crisis. Millions of people calling on leaders to alleviate their suffering cannot afford to be sold out with this distraction. Lawmakers should pass policies that we know advance housing stability, instead of doing the bidding of those attacking it.
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The Promise and Limits of Biden’s Rent Cap Plan
Tenant organizers see the proposal as both a partial measure that kicks the can down a road that could dead-end come November—and a political victory.
Jul 17, 2024
On a trip to Las Vegas, where rents climbed twice as fast as wages last year, U.S. President Joe Biden is pitching a plan for national rent stabilization—sort of. The plan wouldn’t directly cap rents—despite a growing freakout from the lobbying groups that fight tooth and nail to oppose rent controls—and it would need the approval of Congress.
But while acknowledging its limitations, tenant organizers and advocates see Biden’s announcement as a rare acknowledgement that the federal government could wield its vast power to shape the housing market on behalf of tenants.
The announcement is one of several populist economic policies Biden has recently endorsed as progressives like Sen. Bernie Sanders (I-Vt.) circle the wagons around the embattled president while making the case that his path to victory lies through pro-working-class policy. Rising rents are a key driver of inflation and a top concern for voters in battleground states like Nevada.
Since the 2008 financial crash, growing consolidation in the rental market has helped facilitate the largest transfer of wealth from tenants to landlords in U.S. history, with federal financing greasing the wheels.
Tenant organizers see the proposal as both a partial measure that kicks the can down a road that could dead-end come November—and a political victory.
“As recently as a few years ago, we were being laughed out of rooms—rent regulation was a third-rail policy idea,” says Tara Raghuveer, director of the National Tenant Union Federation. As policy messaging, “it’s hard to overstate how significant the shift is.”
Rent control is still fairly rare in most of the United States, thanks to a nationwide industry campaign, beginning in the 1980s, to preempt its adoption at the local level. Mark Paul, an economist at Rutgers University who has urged a rethinking of the conventional economic wisdom against rent control, praised Biden’s announcement as a step in the right direction. “We have policies in place that have helped build the middle class through federal support for housing,” Paul says. “However, that federal support for housing is really only applied to the segment of Americans that can afford to own a house.”
Under Biden’s proposal, landlords who own more than 50 units would face a choice: Cap rents at 5% annually, or lose access to a coveted federal tax write-off, relied on heavily by former president Donald Trump in his real-estate dealings, that allows property owners and investors to deduct the depreciating value of their assets. (“I love depreciation,” Trump said during a 2016 presidential debate.)
Such tax breaks are the lifeblood of corporate real estate speculation. Longstanding policies like the depreciation writeoff and the mortgage interest rate deduction were sweetened even further by the Trump administration’s staggering tax cuts on “pass-through” entities that typically own rental properties. In the red-hot pandemic real-estate market, those tax benefits became a prime selling point for new real-estate firms attempting to lure investment in their acquisition deals. One Massachusetts-based firm that has snapped up large apartment buildings in cities like Atlanta and Phoenix boasts in its marketing that multifamily real-estate investors can end up paying little to nothing in taxes.
Given the slim chances of passing rent caps through Congress, no matter November’s outcome, Paul thinks the Biden administration could do more now to demonstrate his commitment to combating unchecked corporate power in the housing market.
But tax breaks aren’t the only way that federal housing policy props up speculators—or the only lever that the Biden administration, if it’s serious about addressing the cost-of-living crisis, has at its disposal. Since the 2008 financial crash, growing consolidation in the rental market has helped facilitate the largest transfer of wealth from tenants to landlords in U.S. history, with federal financing greasing the wheels.
In the aftermath of the 2008 financial crisis, mortgage giants Fannie Mae and Freddie Mac, along with the Department of Housing and Urban Development, aided and abetted the rise of a new breed of Wall Street landlords by selling them pools of delinquent loans on single-family homes—despite warnings from housing advocates that the buyers weren’t interested in helping homeowners stay in their homes. Reporting by ProPublica found that after 2015, Freddie Mac helped fuel a buying spree of multi-family apartment buildings by private equity firms eager to take advantage of rock-bottom interest rates. More recently, Freddie has worked with groups like Arbor Realty Trust, a key financier for small-time speculators that’s reportedly under probe by federal prosecutors over its lending practices. When corporate landlords move into communities, they often bring with them aggressive eviction policies, lax upkeep, and considerable market power to hike rents. Raghuveer’s group has a corrective in mind: Condition federal financing for landlords on rent caps and tenant protections.
The campaign had a major win this spring when the Biden administration announced a plan to cap rent increases at 10% in housing subsidized by federal low-income tax credits. Now the campaign has set its sights on Fannie- and Freddie-financed properties.
The push to attach strings to these federal dollars has provoked blowback from industry lobbying groups like the Mortgage Bankers Association, which urged the Federal Housing Finance Agency (FHFA), which regulates Fannie and Freddie, not to violate the “sacrosanct” relationship between landlords and tenants by acting as an intermediary.
But more than 30 economists, including Paul, backed the idea in a 2023 letter to the FHFA, making the case that the debate surrounding rent regulation is undergoing a sea change similar to the minimum wage in the 1990s, when a series of empirical studies found—contrary to doomsday prophesying from big business—that wage hikes were not leading to job losses.
The economists’ letter points to evidence from New Jersey suggesting that rent controls did not drive down new construction, as opponents argue. Nor did Massachusetts’ repeal of rent control in the 1990s lead to a housing supply boom.
Given the slim chances of passing rent caps through Congress, no matter November’s outcome, Paul thinks the Biden administration could do more now to demonstrate his commitment to combating unchecked corporate power in the housing market. He points to an announcement just last week from FHFA requiring modest new tenant protections in federally financed properties. The move shows “the FHFA has the authority to regulate these types of properties,” he says. “I would like to see them go a step further and utilize that same rulemaking approach to deploy rent control.”
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Analysis Shows Embracing Bold Renter Protections Can Help Democrats Win in 2024
"Tenant protections aren't just good policies—they're good politics," said one housing justice campaigner.
Jun 18, 2024
An analysis released Tuesday bolsters an argument that progressive lawmakers and organizers have been making with growing urgency in the lead-up to the critical November elections: Housing should be at the top of the Democratic Party's—and President Joe Biden's—agenda.
The research brief, authored by Russell Weaver of the Cornell University School of Industrial and Labor Relations (ILR) Buffalo Co-Lab, shows that tenants are a "large, untapped political base" that can be mobilized by candidates who offer bold solutions to the housing crisis and support the rights of renters against the predatory landlords squeezing them for profit.
While homeowners typically turn out to vote at a far higher rate than tenants, Weaver noted, the "owner-renter turnout gap is nearly cut in half when candidates run on renter-friendly platforms." Renters in New York state (NYS)—the focus of the new analysis—are more likely than homeowners to be registered as Democrats or members of the Working Families Party.
Analyzing the results of New York's statewide general election in 2022, Weaver found that NYS tenants "might have been relatively motivated to turn out for candidates who were vocal supporters or co-sponsors of the 2022 state-level Good Cause Eviction bill, which protects renters against rent hikes and evictions."
"In NYS Senate races that did not feature such a candidate, the average turnout rate among likely renters was roughly 29% (after adjusting for race-ethnicity and political party)," Weaver wrote. "In races that included Good Cause proponents, however, average renter turnout was more than five percentage points higher, at 34.1%—a statistically significant difference."
Weaver said in a statement that his analysis underscores that "candidates who campaign on housing affordability and tenant protections have the potential to significantly boost renter turnout, which could be decisive in tightly contested races."
"An organized tenant voting bloc could be the key to jump-starting a statewide housing policy agenda that works for all New Yorkers," said Weaver.
The findings could also have implications for national races as rent remains high across the country, leaving roughly half of U.S. tenants unable to afford their monthly payments as corporate landlords and billionaire investors gobble up rental properties and drive up costs. The Federal Reserve is also making the crisis worse by keeping interest rates elevated.
"This brief tells us what we already know: Renters are a powerful voting bloc that will determine the 2024 election," Katie Goldstein, a housing justice organizer at the Center for Popular Democracy (CPD), said of Weaver's analysis. "We can't leave these votes on the table."
"Tenant champions who run on these issues will be rewarded at the ballot box—and politicians who fail to do so will be voted out of office."
CPD, Right to the City Action, and HIT Strategies released survey data earlier this month showing that 87% of U.S. voters believe the "cost of rent and housing is a major or big problem in their state" and that 70% said they are "more likely to vote for someone who supports rent stabilization policies."
The new research brief and polling data strengthen the case for making housing a top priority for an incumbent president and Democratic lawmakers hoping to defeat their Republican opponents in November.
"Tenant protections aren't just good policies—they're good politics," said Esteban Girón, member of the Tenants PAC Board. "Candidates have the opportunity to win big by committing to keep rents affordable and protect tenants from displacement."
At a gathering in Los Angeles in early April, Sen. Bernie Sanders (I-Vt.) joined Reps. Pramila Jayapal (D-Wash.), Ro Khanna (D-Calif.) and other lawmakers at the national, state, and local levels in imploring Democrats to elevate bold housing policies and tenant protections such as federal rent control to the top of the party's agenda.
"This is the richest country on Earth. We're not a poor country," Sanders said at the event. "Can we build affordable housing that we need? Can we protect? And the answer is of course we can. But it will require a massive grassroots effort to transform our political system to do that."
Politicoreported earlier this year that Biden has privately expressed "increasing concern" that housing costs are putting his reelection hopes in jeopardy.
"The White House is now pushing a range of bulked-up tax credits to incentivize existing homeowners to sell their starter homes, as well as expand rental assistance and extend help for lower-income buyers with their down payments," the outlet noted. "Yet all those ideas require legislation. And while the White House has publicly argued the crisis affects red states just as much as blue states, aides privately acknowledge any movement is a long shot in an election year. Indeed, Republicans have been quick to pan Biden's housing push."
Presumptive Republican nominee Donald Trump, meanwhile, has not released a housing agenda as he vies for another four years in the White House. During his first term as president, Trump repeatedly pursued steep cuts to federal housing programs and assailed affordable housing initiatives.
Brahvan Ranga, political director of For the Many, said Tuesday that it is "critical we elect legislators who will enact policies that expand tenants' rights, create and maintain affordable green social housing, and affirm housing as a guaranteed right."
"The housing crisis is front of mind for tenants as they head to the polls—both in Democratic primaries and general elections. As housing costs continue to rise and working families struggle to stay in their homes, corporate real estate and greedy landlords are raking in record profits," said Ranga. "Tenant champions who run on these issues will be rewarded at the ballot box—and politicians who fail to do so will be voted out of office."
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