Orange County rent controls could do more harm than good, UCF professor says

Commissioners split over rent control proposal introduced in April

ORANGE COUNTY, Fla. – Orange County commissioners met Tuesday evening to discuss a rent control bill aimed at lowering rent for county residents. According to one UCF professor, some of the guidelines in the ordinance could actually make the problem worse.

Dr. Owen Beitsch, a professor at the University of Central Florida’s Public Administration department, told News 6 that the housing crisis plaguing Central Florida residents stems from three main issues: migration, population growth and housing deficits.

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To start, Beitsch said that more people have been migrating to Florida, possibly as a result of the COVID-19 pandemic. He added that the population has already been growing rapidly, but the amount of new affordable housing being built hasn’t been able to keep up with those increases.

These factors together mean that there just aren’t enough affordable homes for everyone, Beitsch said.

According to Beitsch, many of these problems began with The Great Recession between 2007 and 2009, wherein the United States housing market largely lost value due to improper mortgage lending. He told News 6 that many new homes were being built prior to the recession, though that stopped after the market crashed.

“In my mind, analytically, the problem really begins with recession,” he said. “The (2008) recession caused us to overbuild and then rapidly retreat from that overbuilding, allowing for that excess inventory to burn off the next several years after 2008. But what happened is that inventory burned off.”

Beitsch said that many tradespeople and home developers left the market, ultimately resulting in fewer affordable housing units.

“If my recollection is correct, those numbers show that we here in Central Florida are lower than the state and lower than the rest of the country...” Beitsch said. “And our claims on those units that are being created are growing far, far faster than the inventory is capable.”

Orange County Commissioner Emily Bonilla proposed the rent control ordinance that commissioners discussed Tuesday, which includes a rent-hike cap of 5% (or the rate of inflation) over a one-year period.

According to Beitsch, rent control may seem effective, but it’s only a surface-level solution. If builders can’t earn enough of a profit from building more homes, then they will likely refrain from doing so, creating even more scarcity in a market where people are already struggling to find affordable housing.

“I think the appropriate statement is that rent controls really don’t work anywhere,” Beitsch said. “They do represent a very visible policy and political action... However, it’s a flawed policy because again, there’s a rule that it doesn’t really accomplish much — it tends to discourage further investment in this marketplace.”

Beitsch discussed some alternative solutions that may work better for Orange County, including the creation of a trust fund to support housing developers in creating more homes.

“I believe we identified in (our) report maybe a dozen projects that were greatly accelerated as a result of rather small — at least I consider them small — incentives by closing the gap between what a developer... implementing projects or programs can be able to afford versus the gap that then was closed again, and sometimes in a very small way, by a trust fund,” he said.

Another small solution Beitsch talked about was transforming single-family homes into multi-family homes by creating accessory dwellings; this way, larger developers wouldn’t have so much influence over the cost of housing.

By allowing the owner of a single family home to use a smaller portion of the property as an additional unit, Beitsch argued, more homes could be made in Orange County, driving down prices and making the housing market somewhat more affordable.

“Suddenly, if we think of these individual property owners as potential developers, we have vastly improved the opportunities for multiple persons to deliver housing to the market without the constraints of relying on large developers,” he said.

However, in order to accomplish this, Beitsch said that more people would need to be open to turning their properties into multi-family dwellings and that regulations for unit sizes may need to be reduced.

Board members have been split about whether to vote for the ordinance. Bonilla has been pushing for the ordinance since it’s introduction, saying she wants to help her constituents struggling with rent.

Others, such as Commissioner Christine Moore, said the ordinance is the wrong way to go, fearing potential lawsuits if they try to push it through. Five members of the seven-member commission failed to attend a meeting organized by Bonilla last week.

The ordinance received criticism from Beitsch, other experts and Orange County landlords during a special commission meeting last month.

Following Tuesday’s Orange County commission meeting, the board will move forward with a public hearing on Aug. 9.

If passed, the ordinance will move to a vote on the ballot in November.

About the Author:

Anthony, a graduate of the University of Florida, joined in April 2022.