Building on findings released earlier this year that overregulation can increase multifamily operating costs, a follow-up study from economists at MetroSight sheds light on how some housing regulations increase the cost of rent.
The study, sponsored by the National Apartment Association (NAA) and National Multifamily Housing Council (NMHC), analyzed the impact of source-of-income, eviction, resident screening, and state preemption laws on rent costs. It included two separate datasets, one from CoStar Group that included data from 391 metros between 2000 and 2024 and the other from the U.S. Census Bureau’s American Community Survey with data from 307 metros between 2005 and 2023.
While state preemption laws didn’t have a statistically significant impact, source-of-income regulations as well as eviction and resident screening laws corresponded with increased rents.
• Source-of-income regulations boosted rents between 5.2% and 5.3%, or approximately $876 to $1,104 per unit annually;
• Eviction laws increased rents between 5.9% and 6.3%, or approximately $1,092 to $1,224 per unit annually; and
• Resident screening laws inched up rents between 1.5% and 3.4%, or about $252 to $708 per unit annually.
“As housing affordability continues to be a nationwide concern requiring action from state, local, and federal lawmakers, this study importantly shows how misguided regulations have the ability to increase monthly costs for rents,” said NAA president and CEO Bob Pinnegar. “Now more than ever, our nation needs responsible, sustainable policy solutions that, instead of raising costs, work to boost the supply of housing and improve affordability long term.”
The study also found that residents of small multifamily properties, especially two- to four-unit buildings, were more likely to experience larger increases following the adoption of certain laws. In addition, rent increases associated with certain housing laws were larger for lower-income households than their higher-income counterparts.
NMHC president Sharon Wilson Géno noted it’s critical to understand “how sometimes well-intentioned regulations may impact rent levels—particularly for those who can least afford increases.”
“This new research finds that certain policies, while at times designed to protect renters, are associated with higher rents, especially for lower-income households,” she added. “By bringing these data to light, we and our partners at NAA hope to support a more balanced policy conversation—one that supports renters while improving affordability and expanding the supply of rental housing.”
