Housing advocates know a supply shortage is behind our runaway rents. But their two closest groups of allies sit on either side of the issue, and each see the debate in existential terms. iStock photo illustration

As a statewide rent control referendum starts to look more like a real possibility, some housing advocates may soon find themselves in a tricky spot. 

Supporters of a proposed ballot question that would give cities and towns the ability to cap rents along with sweeping powers to regulate the rental market, cleared a major hurdle last week. 

Attorney General Andrea Campbell’s office certified a petition championed by a prominent Cambridge state representative, Mike Connolly, effectively giving it a green light to start collecting the nearly 90,000 signatures from across the state it needs to assure it a spot on the ballot regardless of the state legislature’s moves. 

Commercial development trade group NAIOP-Massachusetts has already promised a legal challenge, and a coalition of real estate groups, including the Greater Boston Real Estate Board and the Small Property Owners Association, are now weighing whether to join in the fray.  

But barring a reversal in the courts, the proposed referendum, which would repeal a 1994 law that banned rent control, will go before voters in November 2024. 

No One’s Talking 

Before writing this week’s column, I reached out to Abundant Housing Massachusetts, the Metropolitan Area Planning Council, the Massachusetts Housing Partnership, the Citizens Housing and Planning Association and the former head of the Massachusetts Affordable Housing Alliance. 

All these groups have done excellent work trying to help regular families here in the Bay State have a fighting chance at securing a decent place to live, whether it’s an apartment, a condo, or that all but extinct species, a reasonably priced starter home. 

But no one was rushing to call back, which, frankly, did not surprise me – nor would I suggest it is any negative reflection on them. 

All Massachusetts’ major housing advocacy groups clearly understand arguably the central factor that has driven up home prices and rents to insane levels across Greater Boston and increasingly beyond the Interstate 495 belt as well, namely the sharp, decades-long decline in the construction of new housing. 

And there is also a broad understanding that entrenched NIMBY attitudes in local communities, as well as local permitting rules that can drag out project approvals for years. 

Armed with that understanding, it would be surprising if one or more of these major housing advocacy organizations came out in support of the rent control referendum. 

Yes, supporters of the push to revive rent control note it exempts new construction for the first 15 years. And Boston Mayor Michelle Wu’s plan would allow rent increase up to 10 percent in some cases, which supporters contend should be enough to cover any reasonable developer’s pro forma. 

But any way you cut it, rent control is still rent control, with Wu’s plan and now Connolly’s statewide referendum for the most part adamantly opposed by private-sector developers, who, after all, we rely on to build the lion’s share housing in our society. 

Proposals Break Business Model 

While exempting new apartment buildings for 15 years may sound like a big concession, most developers don’t hang onto the rental properties they built, but rather recoup investments that can run into the dozens or even hundreds of millions of dollars by selling to larger, institutional players. 

And given those REITs and big apartment investors are looking at decades-long investment horizons, a rent-increase cap that kicks in after 15 years is a big deal. 

Beyond that, if passed Connolly’s rent control referendum would give a green light to cities, towns and suburbs across the state to create yet another level of red tape and bureaucracy, most definitely the last thing we need as the Healey administration attempts to dramatically boost housing production. 

Scott Van Voorhis

Yet all that said, I would also be surprised if any of the major housing groups also came out against the rent control referendum. 

The fact is, the grassroots passion right now – both in the local Democratic Party and the housing advocacy movement – is sympathetic to if not strongly in favor of bringing back some form of rent restrictions. 

All the public opinion polls to date have shown significant majority of Massachusetts voters support the idea of giving local governments the power to cap runaway rents. 

And tellingly, of the 14 candidates for Boston City Council that responded to the AHMA’s recent housing questionnaire, only one, a long-shot contender in the Back Bay, opposed Wu’s rent control plan.  

Rent control is going to be a tricky, and potentially fraught issue for housing advocacy groups to navigate. Some form of neutrality may be the best bet here, but as the debate heats up, that could prove difficult. 

Scott Van Voorhis is Banker & Tradesman’s columnist; opinions expressed are his own. He may be reached at sbvanvoorhis@hotmail.com.