Lower Rent

Rent rose 31% in 2020.

Rent is going up because of price gouging. Giant companies are artificially inflating their prices after they buy up available properties.

That's Price Fixing.

Rent Prices

Price Increases

2020: 31.4% Increase

Rent in Florida has risen 31.4% from 2020 the issue of housing affordability has reached a crisis level. The rent spike is seen through the ascendancy of larger corporations owning a large majority of available apartments and increasing their market share. Amidst the exponential buying up of apartments by large property management companies, it's no surprise the rental market has become so expensive. These large corporations typically work towards growth regardless of pricing out long-time tenants with no regard for burdensome fees and neglecting the upkeep of units. The Commissioner of Agriculture can address this issue by utilizing a rent hike cap.[1]

 

[1] https://www.tampabay.com/news/business/2020/06/17/with-eviction-freeze-extension-florida-landlords-wonder-how-theyll-recover-lost-rent/

 
Image by Brandon Griggs

1.

Stop Rent

Increases

Image by Aaron Sousa

2.

Remove Red Tape When Applying 

Image by Solen Feyissa

3.

Rent Hike

Cap

Can't Afford A House?
It's The Hedge Funds Fault.

What Can We Do?

The Agriculture and Consumer Services Commissioner can stop these price increases and predatory behavior.

Stop Price Increases

Same Apartment - Less Affordable

Median Rent Prices - $1340 -> $1760 | 2020-2022

Without regulating large management corporations, tenants are falling victim to rent gouging and being priced out of their homes. [1]

 

These private equity-backed corporations are endorsed by Freddie Mac and Fannie Mae, the nation's housing finance system that expands the pool of funds to investors. [2] That being said, these corporations rip off the average consumers by being nationally funded and still hiking rent prices. We need regulations, like the rent hike caps seen in other states during 2019. [3]

 

Real estate investment and property management corporations are purchasing more apartment complexes at rates higher than the average consumer. This is because they are backed by investors and bring cash for purchase, which is more enticing to sellers. With the increased prevalence of private equity firm-backed corporations, tenants are being affected by price hikes in rent, more fees, and less upkeep of units. [4] Since 2020, there has been a 31.4% upswing in rent prices in Florida. Median rent prices have gone from $1340 to $1760. [5] The lack of affordable housing options for prospective first-time home buyers exacerbates the low supply of rental units. People are forced to rent since there isn’t the potential to buy in Florida. [6] Such circumstances leave tenants at the whim of profit-driven corporations, some being priced out of their long-time homes because economies of scale are at play to the traditional landlord.

 

[1] https://www.propublica.org/article/when-private-equity-becomes-your-landlord

[2] https://www.fhfa.gov/about-fannie-mae-freddie-mac

[3] https://www.wptv.com/money/real-estate-news/florida-house-democrats-make-final-plea-for-rent-relief-ahead-of-special-session

[4] https://www.propublica.org/article/when-private-equity-becomes-your-landlord

[5] https://floridataxwatch.org/Research/Full-Library/ArtMID/34407/ArticleID/19154

[6] https://floridataxwatch.org/Research/Full-Library/ArtMID/34407/ArticleID/19154

Graph - Median Rent Prices.png
 
 

Why Did They Deny You An Apartment?

Having no credit cards can mean you will have a lower credit score. Having less debt means you will have a lower credit score. 

They are penalizing every person who is good with their money and forcing them into debt and bad financial practices.

Less Red Tape

End These Requirements When Applying

Remove: Credit Score Checks

Remove: 3x Minimum Income

Large management corporations have the liberty of creating their own rules when it comes to rental applications and their requirements. The infamous rule is that monthly rent should add up to one-third or less than the prospective tenant’s gross monthly income. [1] This rule means that the average tenant should make three times their monthly rent, which is becoming less attainable for the average Floridian. [2] The average wage earner in Florida in 2020 made $44,790 a year, and with the median rent price of $1,590 that year, the one-third rule is unattainable. [3] The median household income is a figure that represents two equal groups, half having incomes above the median and half having incomes below the median. With that in mind, only half of the average households can meet the one-third figure standardized in rental application requirements. As of today, the median gross rent has risen to around $1,760 in Florida.

 

[1] https://www.allpropertymanagement.com/resources/finding-and-managing-tenants/screening-tenants-the-factors-that-matter-most/

[2] https://www.wptv.com/money/real-estate-news/florida-house-democrats-make-final-plea-for-rent-relief-ahead-of-special-session

[3] https://www.gobankingrates.com/money/economy/the-salary-you-need-to-afford-rent-in-every-state/

Graph - Rent Prices Florida.png

Turning to the denial of renter applications on the basis of credit, the most common reasons for such denial are landlord debt in the last seven years, collection accounts exceeding 24% of credit, delinquent accounts exceeding 24% of credit, and initial filing or eviction. [1] By most landlords’ factors, having a credit score of 620+ is ideal for approval, but not everyone has that high of a credit score, especially adult renters without a mortgage in the past 16 years. [2] 96 million Americans fall into this category and make up the majority of renters. They have fewer credit cards, auto loans, and more student loan debt compared to the adult population. 12 million consumers without a mortgage are aged 36–55, have debt in collections and 26% have negative public records on their credit reports. [3] This figure further magnifies the issue with credit score requirements: the majority of the renter pool doesn’t qualify. For the welfare of the Florida population, we must reevaluate this requirement.

 

[1] https://www.watsonrent.com/florida-rental-application-criteria-and-procedures/

[2] https://www.urban.org/sites/default/files/publication/78591/2000652-Comparing-Credit-Profiles-of-American-Renters-and-Owners.pdf

[3] https://www.urban.org/sites/default/files/publication/78591/2000652-Comparing-Credit-Profiles-of-American-Renters-and-Owners.pdf

So, What Can We Do?!

We Implement A Rent Hike Cap

Chapter 146 of the Florida Statutes states that no rent controls can be placed except in the event there is an “existing housing emergency so grave as to constitute a serious menace to the general public”. [1] With the exponential rise of rental prices, we are in a full housing emergency in the State of Florida. For example, Orange County held a special session over rent stabilization, [2] showing efforts to at least place a 5% rent hike cap [3] in the county, mirroring other regions of Florida.

 

The need for something to be done to protect tenants from the profitability of these corporate landlords is imperative for Florida citizens and to preserve our economic workforce. Further intensifying the issue would lead to Florida’s workforce migrating out of the state due to a lack of housing affordability. [4]

 

The rent hike cap initiative we’ve seen exhibited by Oregon, and now Orange County, is the more manageable form of rent stabilization introduced by lawmakers. With consumers backing it and landlords not negatively affected by it compared to a rent freeze, the cap becomes the compromise. A rent cap lasts a year and gives time for the emergency to be resolved, while a freeze would only last three months. A rent cap is not only more popular, but also a more formidable plan, as the Commissioner of Agriculture cannot guarantee the outcome of a special session as proven in the past. [5]

 

[1] https://www.flsenate.gov/Laws/Statutes/2018/166.043

[2] https://www.clickorlando.com/news/local/2022/04/05/orange-county-leaders-to-consider-rent-control-measure-as-housing-costs-skyrocket/

[3] https://www.clickorlando.com/news/local/2022/06/24/orange-county-board-holds-special-session-on-rental-ordinances/

[4] https://floridataxwatch.org/Research/Full-Library/ArtMID/34407/ArticleID/19154

[5] https://www.nbcmiami.com/investigations/some-floridians-want-to-limit-rent-increases-it-likely-wont-happen/2710041/