Montgomery County developers and realtors are concerned the rent stabilization bill (Bill 15-23) passed by the County Council in July could deter new multifamily development, reduce rental housing stock and have the opposite effect lawmakers sought.
The impact the new legislation – which City Council officials say will start being enforced in late Spring 2024 – will have on development in the county is largely unknown.
One major point of concern for multifamily developers and realtors is if the county will now be able to reach future housing targets. The Metropolitan Washington Council of Governments (MWCOG) estimated that the county needs to add 41,000 housing units from 2020 to 2030 to meet the housing demand, which would be approximately 4,100 new units per year. According to Juliana DeSouza, a data analyst at the county’s Department of Permitting Services, the county added approximately 11,308 new individual housing units from Jan. 1, 2020, to July 31, 2023 – 3,686 units and 3,868 units in 2021 and 2022, respectively.
“By 2024, projects that are currently going through the pipeline will continue, but you’re going to see projects getting shelved, companies pulling out entirely,” said Griffin Benton, vice president of government affairs at the Maryland Building Industry Association (MBIA). “You know, by 2025 to 2027 you’re going to see a real crunch in the rental unit market. It’s just going to be challenging.”