NVR study shows many proposed landlord-tenant laws are counterproductive

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Research commissioned by Nevada REALTORS® (NVR) shows many of the landlord-tenant laws being proposed in Nevada and other Western states are likely to harm homeowners, renters and the housing market.

“While many of the laws being proposed by lawmakers here in Nevada and in nearby states may seem well-intentioned, this research shows they’re not popular with voters and more likely to be counterproductive,” 2021 NVR President Brad Spires said.

Nevada REALTORS®, in partnership with Strategic Guidance Systems (SGS) and Portland State University, developed a comprehensive overview of landlord-tenant legislation in the Western United States. The resulting report examines the history of such legislation, as well as the need for affordable housing to address supply constraints.

“While landlord-tenant legislation often aims to address a lack of affordable housing, this study suggests that such efforts ultimately fail,” the report states. “Yet, as the supply of housing is often filled by the private sector, these concerns may be headed off with meaningful changes to permitting, zoning, and incentivizing positive growth.”

At the heart of many discussions on affordable housing is the increasingly tight housing supply, both existing and needed, arising from population growth. The report points out that Arizona, California, Colorado, Nevada, Oregon and Washington have a combined population increase of 82% since 1980.

State lawmakers have increasingly turned to legislation in an attempt to address the limited supply of affordable housing, as well as to limit evictions – especially since the COVID-19 pandemic began in 2020. According to the report, most of these proposals are not working.

While most landlord-tenant legislation “appears on the surface to tackle the issue of rising evictions,” the report finds that “it is generally considered by researchers to be a temporary fix on a larger issue. Without comprehensive change to aid development, housing supplies will continue to shrink, leading to migration out of the region.”

While the western part of the U.S. offers some of the most attractive living conditions in the country, the report cautions that the region could soon begin to lose residents to other areas, including southern states with less stringent housing regulations and a more favorable business climate.

“Already California is experiencing a high level of outmigration to neighboring states, and for the first time in the state’s history, California is growing at a slower pace than the nation as a whole,” the report notes. “While this exodus is bringing economic growth to the neighboring Western states, the new population is also bringing its support for more aggressive housing regulations.”

On the other hand, the report noted that some states “have been proactive in incentivizing construction in order to grow the supply of available housing.” For example, it cited Senate Bill 448, legislation passed during the 2019 session of the Nevada Legislature that provided up to $10 million per year in state tax credits for builders of rental properties. Like a bill known as House Bill 2343 passed by the state legislature in Washington that same year to relax parking space requirements for new developments, the report said “both aimed to relieve costs for developers in order to encourage building.”

The report also raised concerns about laws regulating rents and fees and banning or curbing evictions. As an example, the study cited SB151, a bill passed by the 2019 Nevada Legislature that capped late fees, among other provisions designed to protect tenants. More tenant protection bills have been proposed during the 2021 session, with most of them being opposed by groups representing Nevada property owners, REALTORS®, the apartment industry and others.

“While such legislation is meant to quell evictions and increase tenant rights, scholarship indicates that the end result is a worsening relationship between landlords and their tenants,” the study concludes. “Scholarship also suggests that such laws do not tackle the larger problems of housing supply, which must be addressed through serious consideration of how affordable housing can be produced. To accomplish this goal, there must be open communication and collaboration between legislators, housing advocates, and the builders and developers in the private sector.”

View the report at bringhousinghome.org.

About Nevada REALTORS®
Nevada REALTORS®, formerly known as the Nevada Association of REALTORS® (NVAR), is a professional trade association with more than 18,000 members committed to protecting, promoting and preserving our communities. Visit nevadarealtors.org.

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