Voters said that inflation was the most important topic in the 2022 midterm elections, yet no politician can hope to make progress against inflation without tackling the expense of one fundamental human need: housing. We cannot meaningfully address inflation without addressing skyrocketing rents, which economic historian Adam Tooze has referred to as “the core of the core of U.S. core inflation numbers,” since rising housing costs are the biggest contributor to inflation and one-third of Americans rent their homes.
Rents that are too high can be influenced by President Biden. By tying federal money to maintaining affordable rents, he can help tenants. He can also direct the Federal Trade Commission (FTC) to look into and take action against landlord price-fixing. In order to address the growing influence of private equity corporations over the housing market and to offer clarity about who owns what properties, and substantially increase federal funding for affordable housing.
This year, the national median rent exceeded $2,000 for the first time in history. The highest increase in rentals in 40 years occurred over the previous 12 months, rising by little over 7%. During the same time period, rent hikes in the double digits were observed in other cities. According to a poll, half of renters under 35 said their rent had gone up in the previous year. Even though many young people still want to become homeowners, this dream becomes more and more out of reach as rising rents make it difficult for them to accumulate money for a down payment.
The eviction crisis is detrimental to democracy because it lowers voting rates in areas with high eviction rates. Action on rents would be politically wise given the high number of renters among young people who voted Democratic in November and among Black and Latinx voters.
Unsurprisingly, a developing eviction issue has been brought on by the combination of quickly rising rents, the elimination of COVID eviction moratoria, and emergency rental assistance. The earnings of many corporate landlords, meanwhile, are at an all-time high.
People of colour have been particularly hard-hit by our challenge of housing affordability. Nationally, compared to just 28% of white households, more than 50% of Black and Latinx households rent their houses. In contrast to the 13 percent of Americans who are Black who are homeless, 40% of homeless Americans are Black. In the main population centres of the state, Black and Latinx people saw eviction rates that were about seven times higher than those of white adults, according to research conducted in Washington state.
Biden can assume exorbitant rents without Congress, according to a draught executive order just issued by the Homes Guarantee Campaign. Making reasonable rent a requirement for government housing grants, loans, and subsidies is a major suggestion. Right now, private equity firms that buy homes, raise rents, and remove long-term renters receive funding from the Federal Housing Finance Agency for government-backed loans.
In addition, the campaign is pressing Biden to create a federal interagency council on tenants’ rights to coordinate government efforts to control rents and to pressure the FTC to look into price gouging and unjust surcharges imposed on renters.
Another significant obstacle to affordable rentals is the development of huge investors and private equity landlords in the housing sector during the past ten years. From single-family homes to rentals to prefabricated homes, these businesses have steadily increased their market share. According to our research, private equity landlords frequently hike rent and fees, cut corners on property maintenance, and act hastily to evict tenants. At some point, Biden will have to work with Congress to adopt legislation that would end tax breaks for big investors and alter the tax system to encourage the development of affordable, secure housing for all Americans. So that tenants can learn who owns their property and what possible government subsidies they may have gotten, we need a national landlord register that discloses names behind the anonymous LLCs that own so many of the nation’s rental buildings.
Additionally, Biden must collaborate with Congress to significantly enhance financing for long-term affordable housing. In the elections of 2022, voters overwhelmingly supported state and local proposals to construct more affordable housing. The Inflation Reduction Act, however, which was Biden’s most significant piece of legislation, omitted new financing for the development of affordable homes. It’s time to make up for this wasted opportunity by enacting legislation to increase federal support for the development and upkeep of affordable housing across the nation.
- Next, Biden needs to address the cost of rent and encourage Congress to take action
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