Biden Proposes 5% Cap on Rent Increases to Combat Inflation

President Joe Biden is set to unveil a new housing proposal aimed at tackling rising living costs: a 5% cap on annual rent increases. This move is part of his broader strategy to address inflation, which has been a significant concern in his re-election campaign. Biden will announce this plan during his visit to Nevada on Tuesday, a key battleground state for the upcoming presidential election.

The proposal targets major landlords owning 50 or more rental units. It seeks to provide relief to tenants facing skyrocketing rent prices, which have surged significantly since Biden took office. The national median rent climbed from approximately $1,150 in early 2021 to $1,411 in June 2024.

Biden has framed the rent cap as a measure to counteract corporate greed, particularly in the aftermath of the pandemic. He argues that limiting rent hikes is essential to stabilizing the housing market and easing the financial burden on renters. However, this plan will need solid Democratic control of Congress to become law, raising questions about its feasibility given the current political climate.

The rent cap would not apply to newly constructed units, which critics argue could lead to a reduction in the availability of affordable housing over time. Industry representatives suggest that the plan might not address the underlying issues of housing shortages and could inadvertently reduce the number of habitable rental units.

Biden's proposal comes as part of a broader strategy to show voters that he is actively working to mitigate the impact of inflation, which remains a key issue in his presidential campaign. Housing costs have been a significant contributor to the overall inflation rate, which currently stands at 3% annually.

While the White House has yet to provide official comments on the proposal, Biden previewed the plan during a NATO news conference, emphasizing the need for action to control rising rents. The announcement reflects the administration's ongoing efforts to address economic challenges and reassure voters of its commitment to improving living conditions.

In addition to the rent cap, Biden has proposed other policies aimed at increasing home construction and modifying land use regulations. These measures are intended to tackle the broader housing crisis, which has left many Americans struggling to find affordable rental options.