Rent Control Proposals Being Considered Across the Country. What Impacts Could They Have?
We take a look at how the policies are impacting development and investment decisions.
Rent regulation policies are back in the news across the nation as housing affordability concerns escalate. From New York to California, governments are taking steps to restrict increases, much raising concerns among developers, investors and other stakeholders. Meanwhile, industry advocates are taking steps to counter rent control proposals and assessing the impact of existing measures.
Tracking state and local bills
Last month, the New York City Rent Guidelines Board voted to freeze rents for both one- and two-year leases for the city’s 1 million or so rent-stabilized apartments. It was the most comprehensive freeze since the RGB was created more than 50 years ago.
A rent freeze was one of Mayor Zohran Mamdani’s campaign promises. While the nine-member board is technically independent, the mayor appointed six new members upon taking office in January. Opponents argued that the board ignored its own data that showed a 5.3 percent increase in operational costs.
In Massachusetts, a proposal to put the nation’s toughest rent control measure up for a vote in November was sidetracked by a court ruling, but proponents are gearing up for a public vote in November 2028.
In Redwood City, Calif., voters will decide this November on a rent-control and tenant protection law that would be more stringent than the state’s rules. If the measure passes, annual rent increases for qualified units would be capped at 5 percent or 60 percent of inflation, whichever is less. Because of the state’s Costa-Hawkins Act, rent caps would apply to properties built before February 1995, impacting approximately 40 percent of the city’s rental stock.
The NAA is tracking nearly 200 state rent control-related bills, including 71 introduced in 2026, and monitoring 25 local ordinances. As of February, 36 states prohibited local rent control. Several bills have been introduced to repeal those restrictions, including two Virginia proposals that would have allowed localities to cap annual rent increases at 3 percent and implement rent stabilization ordinances. Both bills failed.
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Washington and California are the only states with statewide rent control, and Washington, D.C. also has a measure on the books. But several states have introduced new legislation this year. New Jersey’s proposal calls for a 5 percent annual limit on rent increases, plus the change in the consumer price index or 10 percent, whichever is lower. More than 120 New Jersey municipalities have ordinances that generally cap annual increases between two and six percent.
Los Angeles recently reduced the allowable annual increase for rent-stabilized units from a range of 3 to 8 percent, plus charges for gas and electricity, to 1 to 4 percent, regardless of operating costs.
“We’ve seen those policies explode over the years and in different markets, in different ways and different manners,” said Greg Cerbana, vice president of public relations and government affairs at Weidner Apartment Homes. “Any amount of rent control, in our view, hurts renters, housing providers and communities alike.”
The National Apartment Association and National Multifamily Housing Council’s position is that rent control exacerbates housing shortages, causes buildings to deteriorate, limits new development and can lead to higher rents.
A proposal blocked by a court ruling
A rent control proposal in Massachusetts has garnered the most attention of any state proposal. The proposed ballot measure called for the strictest statewide rent control in the U.S. It would have lifted the state’s 1994 rent control ban, capping increases at the rate of inflation with a maximum of 5 percent, even with a change in renters. The rent caps would not apply to new buildings for the first 10 years or owner-occupied buildings with four units or fewer. There were some other exemptions for public housing, nonprofits and short-term rentals.
However, the Massachusetts Supreme Judicial Court ruled June 23 that the proposal could not appear on the ballot because it included an exemption for religious facilities that is not permitted under state law.
Homes for All Massachusetts, a coalition backing the proposal, is exploring options for the 2027-2028 election cycle, including another ballot question, reports Carolyn Chou, the group’s executive director. While pending state legislation would allow cities and towns to enact local rent stabilization, it’s unlikely the legislature will act before its session ends on Friday.
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“We know this is an issue that resonates with residents across the state. Just because the ballot question cannot move forward for 2026 doesn’t mean the issue goes away,” Chou told Multi-Housing News.
“We really see at this point in every quarter of the state, we see more and more large corporate landlords buying up buildings, jacking up the rent and it’s a real concern for us, in smaller places and more rural places as well as the bigger cities,” Chou noted.
Prominent critics of the original proposal included Gov. Maura Healey, who argued that the measure would hinder development. Before the court ruling, supporters met with developers to craft compromise provisions that could have limited rent increases to the rate of inflation plus 5 percent, with a 10 percent cap.
“For us, this was not about an ideological position, but really about getting something done as quickly as possible,” Chou said. “We had expressed openness to that and then started talking to some individual developers that were willing to come to the table.”
Conor Yunits, a spokesman for Housing for Massachusetts, an industry group with founding members including NAIOP Massachusetts, the Greater Boston Real Estate Board and the Massachusetts Association of Realtors, believes that the ballot measure’s proponents put up the restrictive version to get leverage and scare the industry into finding something in the middle.
“To call it a compromise is ludicrous, because all they put forward was a bunch of proposals that have gone nowhere in the State House,” he said.
Had the measure been placed on the ballot, Housing for Massachusetts planned a robust campaign that it believed would have defeated the proposal. The coalition will stay intact and keep prepared to counter future proposals by rent control supporters, Yunits notes.
“This issue is not going away. For those of us who think it’s a terrible idea, we just need to keep fighting at it and keep educating the public and helping people understand that this is not the remedy they’re promised,” Yunits told MHN.
On the ground impacts
Weidner, a Kirkland, Wash.-based owner-operator and developer of market-rate housing, experienced the impact of rent regulation policies in real time when city officials in St. Paul, Minn., approved a stringent rent control law in 2021 that went into effect the next year.
Weidner, which owns and manages close to 76,000 units in 14 states and four Canadian provinces, was working with Ryan Cos. to develop 2,300 market-rate multifamily residences at Highland Bridge, a 122-acre master-planned, mixed-use community on the former Ford Motor Co. assembly plant site. Ryan’s plan called for a total of 3,800 units, including 760 affordable units. Once the St. Paul ordinance emerged, however, the project’s underwriting no longer worked, according to Cerbana.
“It was a 3 percent hard cap,” he said of the ordinance. “There was no consideration for any other expenses that went in there. There was no vacancy decontrol. There was no exemption for new construction.” Those factors made it difficult for developers and investors to consider St. Paul, he told MHN.
Weidner continued building the first 230 units, but later dropped plans for the remaining apartments. The firm wasn’t the only developer that ceased work in St. Paul. Greg Brown, senior vice president of government affairs at NAA, said project starts declined 30 percent after the city implemented rent control.
Ben Harrold, the National Apartment Association’s senior manager of public policy, noted that the city revising the law. They’ve added exemptions for new construction, allowed for vacancy decontrol and allowed landlords to request increases of more than 3 percent if their expenses rise significantly.
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“You can see the very immediate damage to housing starts from right after the policy was passed. But across the river you’ve got Minneapolis, which took almost the exact opposite approach in terms of allowing for developers to make it easier to build,” Harrold said.
Since 2023, Weidner has invested close to $750 million representing nearly new 3,000 units in Minneapolis. The city has listened to the industry and so far, has “not engaged with rent control or public policy initiatives that would be detrimental to development,” Cerbana said. “We’re betting on Minneapolis and its long-term viability.”
In the near future, Weidner plans to return to St. Paul in recognition of some of the changes the city has made to its rent control policy, with plans to build 176 new units.
Walking it back
Weidner’s experience in St. Paul is not unusual. NAA research shows that 70 percent of providers say rent control has a significant impact their investment and development plans.
“We also have research about the impact of rent control on the physical state of housing properties themselves. When you impose those kinds of caps, inevitably the physical state of the property will decline over time,” Brown said. “I think these are all things that are important in the context of policymakers making these decisions.”
Cornell Communities, an owner and operator of manufactured housing communities, generally avoids states or municipalities with rent regulations in place or under consideration,
“Rent control and regulation limit our ability to adequately budget for necessary expenses and run a normal business plan, so we frequently pass on projects because of this,” said Leo Young, the firm’s founder & managing partner.
Attorney David Leon, a partner at Nelson Mullins and chair of the firm’s affordable housing practice, gets frequent calls from developers in the Northeast about investing in Florida. Leon’s firm has done a lot of work with developers in the area due to the state’s Live Local Act, which bans rent control and incentivizes developers to build affordable and workforce housing with property tax exemptions. The law also makes it easier to build affordable housing in commercial or industrial zones.
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Leon told MHN he that he knows a developer that has switched plans for a high-end project to develop units for residents with households earning 80 to 120 percent of the Area Median Income to take advantage of the Live Local property tax exemption.
Some communities are repealing or moderating policies. Harrold cited Half Moon Bay, Calif., where officials rescinded 2024 rules that capped annual increases at 3 percent or 80 percent of the inflation rate. For the 2025-2026 rental year, the allowable increase was 1.23 percent. The city will rely on the statewide Tenant Protection Act of 2019, which limits annual rent hikes to 5 percent plus the rate of inflation, and exempts newer buildings from rent control.
Other California cities, including Concord and Salinas, have scaled back local rent control programs in favor of the less stringent state law.
“I think these smaller jurisdictions understand that this policy has not always been the sort of golden ticket to solving (housing) affordability,” Harrold opined.
