Rental Housing Fees: A Serious Burden on Renters
President Biden is taking action to address the issue of rental housing fees, which have become a significant burden for millions of families seeking rental accommodations.
From repeated rental application fees to unexpected “convenience fees,” these costs can add up, often exceeding the actual cost of the services provided.
Many renters are also surprised by additional mandatory fees added to their rent, covering services they may not want or assume are already included.
Rental application fees alone can range up to $100 or more per application and frequently surpass the actual expenses associated with background and credit checks. Since prospective renters typically apply for multiple properties during their housing search, these application fees can accumulate to hundreds of dollars.
Even after securing housing, tenants may find themselves charged with various additional fees, including those for online rent payment, mail sorting, trash collection, and mysterious “January fees” without a clear reason.
Hidden fees not only strain individuals financially but also make it challenging to compare rental options. Prospective renters may opt for an apartment they believe to be more affordable, only to discover that additional fees and add-ons make it more expensive than expected, putting a strain on their budget.
New Steps in the Effort to Curb Rental Junk Fees
President Biden is outlining several new concrete steps to address rental junk fees and alleviate financial burdens for renters. These steps include:
Major Rental Housing Platforms Committed to Transparency
Major rental housing platforms such as Zillow, Apartments.com, and AffordableHousing.com have answered the President’s call for transparency and will provide consumers with upfront cost information on rental properties.
This information will include not only the advertised rent but also additional costs, which can amount to hundreds of dollars. These platforms are empowering renters with clear information about the total cost of renting, allowing them to make informed decisions without being caught off guard by hidden fees.
New HUD Research on Addressing Rental Housing Fees
The Department of Housing and Urban Development (HUD) is releasing new research that presents a blueprint for a nationwide effort to address rental housing junk fees. This research provides insights into strategies that encourage transparency and fairness in the rental market.
Some of these strategies include capping or eliminating rental application fees, allowing renters to provide their screening reports, and clearly identifying all costs for move-in and monthly rent.
Legislative Action Across States
States across the country, from Connecticut to California, are joining the Administration in its effort to crack down on rental housing fees and protect consumers. Numerous states have already taken action to address the hidden and unfair fees, implementing measures that limit fees, require clear fee disclosures, and prohibit certain charges.
Tackling Junk Fees Across Industries
President Biden has consistently advocated for addressing junk fees across various industries, urging federal agencies, Congress, and private companies to take action to ensure honest, transparent pricing for Americans.
Hidden fees have been shown to increase the cost consumers pay, with studies revealing that customers end up paying up to 20 percent extra when the actual price is not disclosed upfront. As a result, transparent pricing fosters competition among providers, leading to lower costs without relying on hidden fees.
Earlier this year, HUD Secretary Marcia Fudge released an open letter encouraging policies that promote transparency and fairness in fees specifically faced by renters. In doing so, the aim is to create a more equitable rental market for tenants.
Building a Fairer Rental Housing Market
The actions announced by President Biden build on the Administration’s ongoing efforts to support renters, including the release of a Blueprint for a Renter’s Bill of Rights and a Housing Supply Action Plan aimed at boosting the supply of affordable rental housing.
Recent data shows that inflation in rental housing is abating, and experts expect to build approximately one million new apartments this year, further increasing affordability.
By helping renters understand fees and total costs, these actions create competition among housing providers to reduce reliance on hidden fees.
In the coming months, the Biden-Harris Administration will collaborate with Congress, state leaders, and the private sector to address rental junk fees and foster a fairer rental housing market.
The Senate Committee on Banking, Housing, and Urban Affairs will host its first-ever hearing on junk fees, including those in the rental housing market, on July 26.
Sources: THX News & The White House.
