Maryland’s highest ranking housing official said Monday that the state’s shortfall of residential building supply had reached a “crisis” pitch, hinting at several steps state government would take next year when legislators reconvene in Annapolis for the next General Assembly session.
But Maryland Department of Housing and Community Development Secretary Jacob R. Day told those attending the Maryland Affordable Housing Coalition’s annual meeting that adopting one possible solution — capping annual rent increases by property owners and managers — was doubtful. He said state lawmakers would likely not prescribe it as a solution for Marylanders, at least not this year.
“I mean, I don’t get a vote. But I’d be shocked,” Day said during a panel discussion. “Do I think that’s the ticket to addressing our crisis today? Probably not.”
Calls for caps on annual rent hikes have gained traction in Maryland and around the country as renters’ wages fail to keep pace with surging housing costs. Just last month, Howard County Executive Calvin Ball — following similar legislation put forward in neighboring Prince George’s and Montgomery counties — introduced a package of housing affordability bills including one that would cap rent prices from rising more than 10% annually or 5% plus inflation, whichever is less. In response, a protester, representing a coalition advocating for an even stricter rent control figure, crowded the lectern and was escorted away.
Meanwhile, the attorney general of Washington, D.C., is suing 14 of the city’s biggest landlords, alleging they colluded with a software company to inflate rent costs across more than 40,000 apartments in the city. At least one of those companies is based in Maryland.
But Day said rent control measures might not support the rise of such expenses as real estate taxes and insurance costs — two market realities that could dissuade developers from taking on meaningful projects and make affordable housing event more scant in Maryland.
And though he stills considers it unlikely to be up for debate in 2024, Day said he wouldn’t take a statewide rent stabilization measure “off the table” completely.
“I support rents not rising at a rate that makes our communities in Maryland unaffordable,” Day said, noting that as president of the Salisbury City Council in 2014, he allowed a rent control proposal to fizzle out. “I didn’t think it was the right policy solution to address the challenges at the time. But since then, wages have not risen very much. Rents have risen quite a bit.”
Day proposed several other tools that he said could have a more meaningful impact on Maryland home and rent costs, including the imposition of parking “maximums” in local jurisdictions to free up more land; more money at the state level to invest in financing programs that support housing and affordable housing creation; strategic investment in historic neighborhoods to leverage certain tax credits; and more state government assistance with county-level planning and permitting to standardize those processes.
Day, also Salisbury’s former mayor, told the crowd at the Hotel at Arundel Preserve in Hanover that the agency views its role through a trifocal lens, one that levels the playing field among local governments and helps housing departments to be “predictable, transparent and well-equipped” across the board. He said his background as a local executive and urban planner colored his views of the job in a way that likely diverged from several of his predecessors with less specialized backgrounds.
Maryland is facing a housing shortfall of at least 91,000 units, said Dan Reed, regional policy director at Greater Greater Washington, who participated in the Monday morning panel with Day. Reed, who described once seeing their rent bill grow by 33% while living in North Bethesda, called on the state housing department to act as “bully pulpit” to incite more action among the counties and create more incentives for housing development.
And Dominic Butchko, associate policy director at the Maryland Association of Counties, noted the state’s shortage of environmental health officers and overconcentration of limited liability companies that sometimes buy properties and allow them to decay.
He made a direct appeal to Day for an additional $275 million to support Rental Housing Works, a state program that provides loans to developers who receive financing from state programs for multifamily homes and low-income housing.
“We will not turn down $275 million if awarded to the department in our budget,″ Day said, inciting claps and cheers from the crowd. “That wasn’t intended to be an applause line, but I’ll take it.”
