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Working & the Economy

Without council action, tenants in Montgomery County could see higher rents

Advocates rallied for a bill that would limit rent increases in Montgomery County before a council hearing last week. Photo by Nene Narh-Mensah.

Montgomery County residents could face higher rents later this month, after the County Council didn’t move forward last week with a bill that could extend a limitation on rate increases. A previous bill limited rent hikes during the pandemic and required three months’ notice, but expired in mid-May.

The council held a public hearing last week on a bill from County Executive Marc Elrich (D) that would extend the COVID-19 Renter Relief Act for six more months, setting a new limit for rent increases of 4.4%.

“County renters continue to face economic hardships due to COVID-19 impact on income, health, and family obligations,” Elrich wrote in a memorandum. “The County’s economy will be materially harmed if significant and rapid rent increases force residents to move or experience housing, food, and health insecurity.”

Councilmember Will Jawando (D) released a statement in support of the bill after Tuesday’s public hearing.

“As we grapple with economic uncertainty and a shortage of affordable housing, it is clear we need to develop some measure of rent stabilization,” Jawando said.

Jawando also expressed disappointment that the council didn’t reach a vote on the measure before a summer recess for councilmembers begins and August rent increases occur; the council is not expected to meet again until Sept. 13.

During the public hearing, proponents of the bill said that it would help support the county’s most vulnerable populations while they’re still feeling the effects of the pandemic.

Laura Wallace, the county director for Jews United for Justice, said that the legislation would serve as a short-term solution to prevent homelessness for residents facing housing insecurity.

“Members of our community, from young people, to professionals to seniors are experiencing housing insecurity and all the trauma that comes with the loss of housing,” Wallace said. “The fact is that the COVID-19 crisis is not over.”

Activists with CASA, an advocacy group that supports and advocates for Latino and immigrant populations in the state, spoke in front of the council building before the meeting.

“Enough of the rent increases. The people who are affected are the moms and dads who have kids who have to decide what they’re going to pay for — because the rent increases are becoming so high,” said Jose Coronado-Flores, committee organizer for CASA. “We need the protection now, we need Bill 22-22 to be passed now.”

Elrich spoke at the rally as well.

“Whether or not people philosophically agree with rent stabilization, I philosophically don’t agree with displacing people,” Elrich said.

Opponents of the bill said that stopping rent increases would harm small landlords and set up residents for a shock once the legislation ends and rents rise sharply.

Dean Hunter, the CEO of the D.C. Multifamily & Rental Owners Association, a trade group representing small rental property owners and managers of rental properties said the law’s broad nature benefits the rich.

“The problem is while half or more of the housing is provided by small landlords, the county and the government regulates everyone as if they’re multinational corporations,” Hunter said during his remote testimony. “Small providers are still recovering from the pandemic; they were disproportionately harmed.”

Sid Menkis, the CEO of Rockville-based real estate firm Menkis Real Estate, echoed Hunter’s point stating that many of his clients who own property only have one unit and that those developments are their sole income.

Not being able to increase rent, while the costs of maintaining the property rise creates an undue burden, the property manager said.

“We’re seeing a restriction on what we can do. There’s been a financial burden placed on landlords,” Menkis said. “We all agree affordable housing is a noble cause. But with inflation at record levels, it’s not fair. It’s not equitable.”

Montgomery County’s previous temporary rent increase ceiling of 0.4% expired May 15. Increases above that amount will begin taking effect on Aug. 15.