LAS VEGAS (KTNV) — Nevada lawmakers are proposing a new bill that could keep rent prices from going up.
Senate Bill 426 would look at the cost-of-living index, which is determined by the state's housing authority, to determine rent increases. It would also ban landlords from increasing the rent during the first year of residency.
According to the National Low Income Housing Coalition, full-time minimum wage workers can't afford a two-bedroom apartment anywhere in the United States.
Here in Nevada, those employees would have to work at least 74 hours a week to afford a one-bedroom rental apartment.
Senator Pat Spearman said the state has put some measures in place to try to help workers but it's not enough to cover rising rent prices.
"We have enacted statues to annually increase our state's minimum wage but it is currently limited to a 75 cent increase per year," Spearman said. "The consequences of this trend are far-reaching and are making people make tough decisions about their living situations often leading to overcrowding, relocation, or even homelessness."
Spearman said that data shows investors purchased 30% of single-family homes sold in Nevada in 2022, which is almost double compared to 2020.
Ted Pappageorge, the Secretary-Treasurer of the Culinary Union, said more investors moving into the valley is leading to neighborhood instability and putting some goals on hold.
"We have Wall Street landlords, private equity, large corporations buying homes, apartments, Airbnbs cornering the market, raising rents beyond affordability causing evictions and turns of residency and creating a generation of renters and denying that generation the American dream of owning a home," Pappageorge said. "The Nevada legislature has a responsibility to stand up for Nevadans against corporate landlords who are price-gouging families."
It's a sentiment echoed by the AFL-CIO.
"The struggle is real," Susie Martinez, Executive Secretary-Treasurer of the organization, said. "This is not a Republican issue. It's not a Democratic issue. If all of you canvassed for your campaigns, you're all aware this is a big problem in our wonderful state."
Senator Jeff Stone is a landlord and he said he's worried this legislation creates "an unequal playing field".
"For smaller investors that are going to have caps on their rent increases, not to exceed 5% even though you may have an inflation factor like we do today of 8.5%, I don't know how the constitution protects institutional buyers from not being held accountable for rent increases but smaller landlords are going to be subjected to this," Stone said.
He added this legislation could lead to even higher prices.
"Why would you put a 15-year exemption from this new law for any new construction when their base rents would be established when they start renting their units," Stone said. "Right now, the cost to build a typical apartment in Nevada is at or higher than $400,000 a door. So while they may have a lower rent to get people in to fill their units up, you can expect, in the years to follow, you'll see exorbitant rent prices because they have to make a return for their investors."
The Nevada State Apartment Association said the bill could also lead to negative side effects including reduced investment in rental properties, reducing the quality of rental housing, and rent-controlled apartments getting harder to find.
The Vegas Chamber also spoke out against the proposed legislation.
"It is the principle of the Chamber to believe in the free market of pricing and remove burdensome government intervention in determining prices," Dylan Keith, the Assistant Director of Government Affairs, said. "The Chamber has supported several other measures. As we look at the severe shortage of housing in Nevada, there are as of the last report in November, 80,000 units that need to be made to address the housing shortage. This bill will not do that."
Keith said lawmakers should speed up licensing requirements and creating abatements for affordable housing units to address the problem.
