Mortgage Bankers Assn. releases statement opposing Biden administration’s planned announcement to impose a 10% limit on annual rent hikes at LIHTC-financed multifamily properties

WASHINGTON, D.C. (March 29, 2024) — MBA President and CEO Bob Broeksmit, CMB, released the following statement on the Biden administration’s planned announcement to impose a 10 percent limit on annual rent hikes at properties supported by the Low-Income Housing Tax Credit (LIHTC):

“The LIHTC program is the federal government’s most successful tool to construct and rehabilitate housing for low- and moderate-income households. If the Administration imposes unworkable rent caps on LIHTC programs, it will severely suppress – if not kill – the program. Such a move is puzzling and contradicts many of the Administration’s other efforts to increase affordable rental housing.

“Rent control has consistently proven to be a failed policy that discourages new construction, distorts market pricing, and leads to a degradation of the quality of rental housing – the exact opposite of what is currently needed in markets throughout the country. A perfect example of rent control’s disastrous consequences is what is happening now in St. Paul, Minnesota, compared to neighboring Minneapolis. Now is not the time to repeat a policy widely recognized as a failure at the local, national, and global level by nearly every economist.

“Increasing the supply of affordable rental housing – not rent control – is the best way to solve the ongoing affordability crisis. MBA will continue to call on the Administration and Congress to make the federal government’s multifamily lending programs more viable, competitive, and less costly for borrowers and developers alike. This includes our continued advocacy for the Senate to pass H.R. 7024, the “Tax Relief for American Families and Workers Act of 2024,” a bipartisan bill that passed in the House earlier this year and includes meaningful enhancements to the LIHTC program.”