Why Cities and States Are Reluctant to Pass Rent Freeze Amid COVID-19

The City of New York is reluctant to pass a rent freeze bill amid the COVID-19 crisis. Drew Angerer/Getty Images

As the pandemic drags on, there is a looming rent crisis in the U.S. disproportionately affecting populous cities like New York and Los Angeles. And despite a month-long push for a rent freeze in many of these cities, little traction has been gained at the legislative level.

In late March, shortly after New York City banned evictions indefinitely in response to COVID-19, Brooklyn and Manhattan Borough Presidents Eric Adams and Gale Brewer, along with city council member Robert Cornegy Jr., introduced a “Renter’s Choice” plan that would allow tenants to pay rent with security deposits. Mayor Bill de Blasio has been reviewing the proposal since then.

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The city said a rent freeze would need to be in conjunction with state-level legislation. But Governor Andrew Cuomo has so far resisted any rent relief measures beyond eviction-related moratoria.

To his credit, de Blasio has been pushing hard for “Renter’s Choice.” “Let New Yorkers who can’t afford the rent pay it with their security deposit. That’s going to take a legal change. I’m asking the state to do that right away,” he said in a press conference on April 13.

The mayor revived his call on the state government on Friday. “To me, it’s abundantly clear, we need a rent freeze,” he told reporters during Friday’s coronavirus briefing, adding, “The most obvious solution [is to] let renters use their security deposits to pay rent now.”

While critics argue that such a move could put landlords who need to pay mortgages in a bind, that’s not necessarily the case to all landlords. In New York, for example, tenants can easily find out through an online database whether their building owners owe a mortgage on the property and, if not, when it was paid off.

Renters who have a non-renewable lease expiring soon could face a problem similar to eviction if their landlords decide not to renew the contract.

The upcoming summer months are typically the busiest moving time for renters. According to a study commissioned by RentHop, an apartment search firm, New York City sees five percent more apartment rental sign-ons in summer than the rest of the year, largely driven by college students who move from one apartment to another at the end of an academic year.

Similar trends have been observed in Philadelphia and Washington D.C.

In Los Angeles, the nation’s second largest city where the high unemployment rate is straining local residents’ financial readiness, rent freeze is implemented only in certain unincorporated areas. On Thursday, the City of Los Angeles failed to pass a COVID-19 relief package that included a sweeping rent freeze measure.

Other cities have more encouraging news. In January, Cincinnati, Ohio passed a law that allowed renters to pay up to one-month rent using a security deposit. The legislation was not in response to COVID-19, though, but an effort in the works since October 2019.

In Austin, Texas, one of the country’s most renter-dense cities, lawmakers passed a measure in late March giving tenants a 60-day grace period to pay rent before landlords can give eviction orders.

Why Cities and States Are Reluctant to Pass Rent Freeze Amid COVID-19