Rental Housing Regulation Trends Property Managers Need to Know in 2024

How prepared are you to navigate the rapidly changing landscape of property management in 2024? If you aren’t staying informed and adapting your rental business to take advantage of regulatory changes you may be leaving more money on the table than you think.

With platforms like CredHub leading the innovation in rent payment reporting, it’s crucial to integrate such advancements with a keen understanding of regulatory trends to manage rental properties effectively and legally. Here’s a look at the key rental housing regulation trends for 2024 and their potential impact on the property management industry.

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Tenant Screening

Regulatory adjustments in some states have reshaped tenant screening practices, particularly regarding the use of criminal records and credit scores. These changes aim to foster a fairer screening process that minimizes discrimination. Landlords must familiarize themselves with these updated requirements to ensure compliance. The modifications are designed to benefit tenants by promoting equity in housing opportunities, requiring a more nuanced approach to evaluating potential renters.

Additionally, there has been a significant increase in rental application fraud, which has doubled since early 2020. To combat this, property managers should leverage advanced tenant screening tools that include automated identity and income verification. These tools can instantly verify applicant information, reducing the reliance on potentially falsified documents and ensuring a more secure screening process (Snappt) (Plaid) .

Rent Control Measures

Several states have revisited their rent control statutes, implementing adjustments that might restrict how significantly and frequently landlords can increase rent. This is part of broader efforts to stabilize the rental market, especially in high-demand areas. For tenants, these adjustments could mean more predictable living costs, enhancing affordability in competitive markets. Landlords, however, may need to adjust their financial strategies to align with new limitations on rent increases, balancing operational costs with regulated pricing.

Moreover, the ongoing controversies surrounding RealPage’s rent-setting algorithms have further highlighted the complexities of rent control. RealPage, a prominent provider of revenue management software, has faced multiple lawsuits accusing it of colluding with large landlords to artificially inflate rents. These lawsuits claim that RealPage’s software facilitates a form of price-fixing by encouraging landlords to share sensitive pricing information and adhere to the software’s rental price suggestions, which often lead to higher rents and reduced transparency in the market (Marketplace) (ProPublica) . The Department of Justice and several state attorneys general are actively investigating these practices, and the outcomes could significantly influence future rent control measures and enforcement (Commercial Observer) .

Occupancy Standards

Updates to occupancy standards have been enacted in certain states, altering the permissible number of residents based on a unit’s size and layout. These revisions are intended to ensure that occupancy limits are reasonable and reflect modern living arrangements. Property managers and landlords are required to comply with these updated standards to promote safe and comfortable living conditions. Tenants should be aware of these limits to maintain compliance and avoid penalties related to overcrowding.

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Maintenance Requirements

Some states have clarified or amended the maintenance obligations that fall on landlords, covering essential aspects of property upkeep, safety, and habitability. These changes may detail the expected timelines for completing repairs and outline specific landlord responsibilities. The emphasis on clearly defined maintenance requirements aims to benefit both landlords and tenants. Landlords receive concrete guidelines on their obligations, while tenants gain assurances of living in well-maintained and habitable environments. This mutual clarity is expected to foster better landlord-tenant relationships.

Market and Affordability Trends

According to the Joint Center for Housing Studies at Harvard University, 2024 sees the rental market undergoing significant shifts. While rental markets are cooling with rising vacancy rates, affordability remains a pressing issue. Over half of all US renters were cost-burdened in 2022, spending more than 30% of their income on rent and utilities. The loss of low-cost rental housing units has exacerbated this issue, pushing many renters into financial strain. The continued rise in homelessness and housing instability reflects these challenges, highlighting the critical need for increased rental assistance and policy interventions to support low-income renters (Harvard Joint Center for Housing Studies) (Harvard Joint Center for Housing Studies) .

How CredHub Can Help

The year 2024 marks a period of significant regulatory evolution in the property management sector, reflecting a collective move towards more equitable, stable, and transparent housing markets. For property managers and landlords, these changes necessitate a proactive approach to compliance and an adaptation of business practices to meet new standards. Platforms like CredHub, which streamline rent payment reporting and compliance, become invaluable tools in navigating this changing landscape.

1. Accurate Rent Payment Reporting: CredHub provides accurate and timely rent payment histories, which can be crucial for tenant screening and maintaining compliance with rent control regulations. This transparency helps build trust with tenants and ensures that property managers can make informed decisions (Marketplace) (CredHub) .

1. Enhanced Compliance Tools: The platform offers tools to ensure compliance with local and state regulations, reducing the risk of legal issues and fines. This feature is particularly important in markets with stringent rent control measures (Marketplace) (CredHub) .

1. Data-Driven Insights with Expert Guidance: CredHub’s expert team aids property managers and owners in strategic development by providing valuable insights into rental market trends and tenant behaviors. This data-driven approach, backed by industry expertise, ensures that properties remain competitive and profitable. The guidance from CredHub’s seasoned professionals helps tailor strategies to meet the unique needs of each property, ensuring optimal rent price positioning and enhanced tenant relations (Marketplace) (CredHub) .

1. Tenant Benefits Package: CredHub works with property management companies to offer rent reporting to their renters by setting up, maintaining, and streamlining the process. This includes reporting to all three credit bureaus — Equifax, TransUnion, and Experian — helping tenants build their credit scores while ensuring property managers can easily manage this benefit (CredHub) (CredHub) .

For property managers, the ability to stay ahead of these trends not only ensures legal compliance but also positions their properties as attractive and competitive options for potential tenants. As the industry continues to evolve, embracing innovation and regulatory changes will be key to achieving success and sustainability in the property management field.

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References:

- Joint Center for Housing Studies of Harvard University, “America’s Rental Housing 2024.” Link

- Marketplace, “RealPage rent-fixing lawsuit highlights use of algorithms to set rents.” Link

- ProPublica, “DOJ Backs Tenants in Price-Fixing Case Against Big Landlords and Real Estate Tech Company.” Link

- Commercial Observer, “Rent-Fixing Lawsuit Against RealPage Moves Forward.” Link

- Plaid, “How instant rental verification transforms tenant screening.” Link

- Snappt, “Rental application fraud statistics.” Link

- Consumer Finance Monitor, “CFPB issues two new FCRA advisory opinions on background screening reports and disclosure of credit files to consumers.” Link