Our country’s history of housing discrimination created the current conditions in which low-income communities and communities of color disproportionately rent their homes, placing them at the whim of a largely unregulated market with few tenant protections. Prior to the COVID-19 pandemic, nearly 10 million renter households in the U.S. were severely cost-burdened (paying more than 50 percent of their income on rent). In 2023, the minimum wage needed to afford a modest one-bedroom home at a fair market rate in the United States is $23.67 per hour. As rents have continued to skyrocket with inflation and other factors, the need for protections for tenants in privately owned residential properties has increased.
Rent stabilization, sometimes referred to as rent control, is an effective yet underutilized tool to increase housing stability and affordability for current tenants. It works by protecting tenants from excessive rent hikes, usually by creating a predictable schedule for the maximum rent increase allowable each year while ensuring a fair return for landlords. It is a smart, proven policy that can immediately stabilize prices, halt rent gouging, and reduce the risk of displacement and homelessness while increasing housing security and affordability over the long term. By decreasing renter housing cost burden over time, rent stabilization leaves tenants with more money to spend on essential needs and in the local economy. The increased stability and affordability created by rent control also have positive consequences on mental and physical health, children’s educational outcomes, and community stability.
Rent controls were first implemented in the United States during World War I and World War II era in response to housing shortages and rent gouging, and then were implemented again in many cities in the 1960s and 1970s in response to a growing tenant movement concerned about civil rights and inflation.
The growth of rent stabilization in major cities created a backlash from the real estate industry, which worked diligently to fight its spread by initiating and supporting preemption policies across the country, in addition to undermining efforts through legislation like the Costa-Hawkins Rental Housing Act. More recently, there has been renewed interest in rent stabilization from cities and states. Both California and Oregon passed statewide rent stabilization in 2019, New York strengthened its laws in 2020, and Saint Paul became the first city in the Midwest to enact rent stabilization in 2021.
What are we calling it?
Multiple terms are often used interchangeably to describe rent stabilization policies, including:
- Rent regulations: a general term for policies that aim to make private rental housing more affordable to tenants, whether by limiting rent increases, setting maximum rents, establishing rules for determining fair rents, and/or subsidizing lower rents or smaller rent increases
- Rent control: sometimes referred to as “first-generation rent regulations”, these are policies that strictly regulate rent increases through price ceilings
- Rent stabilization: sometimes referred to as “second-generation rent regulations” or “modern rent control”, these are policies that restrict how much landlords are allowed to increase rent annually
- Rent cap: the rate that landlords are allowed to increase annually, most often in the form of a percentage that can be paired with inflation
- Rent freeze: policies that prohibit rent increases and/or strictly set maximum rents, usually for a short period of time such as during a public health emergency
See Local Progress, USC Dornsife Program for Environmental and Regional Equity, the Center for Urban and Regional Affairs at the University of Minnesota, and the Right to the City Alliance for more resources on rent stabilization ordinances.