Montgomery County’s new Office of Rent Stabilization (ORS) has barely finished its first annual report, released Feb. 19, and it is already fueling a political showdown over the future of local housing.
According to the report, the county’s rent‑stabilization law is doing what supporters promised: blunting steep rent hikes, clawing back money for tenants and nudging some landlords to finally deal with lingering code problems. On the other side, planners and developers argue the same policy is icing the multifamily pipeline and could slow new housing construction. That split now heads straight to the County Council, which has to thread the needle between tenant protections and development incentives.
How the law works
The law caps annual rent increases at the lower of the local Consumer Price Index (CPI‑U) plus 3 percentage points or a flat 6% limit, and it exempts properties built within the last 23 years. That rolling exemption means every year more buildings age into regulation. For 2025, the county set the maximum increase at 5.7%, based on a CPI‑U of 2.7% plus 3%. The ordinance also restricts what fees landlords can charge and allows rent increases only once every 12 months. The detailed mechanics are laid out by Montgomery County DHCA.
County: enforcement, refunds and code wins
In a Feb. 19 briefing, County Executive Marc Elrich and Department of Housing and Community Affairs (DHCA) Director Scott Bruton walked through the ORS findings and argued the law is delivering for renters.
The county says ORS handled 1,390 requests from the public and helped secure roughly $91,759 in rent and fee refunds. That total includes $68,516 in rent refunds spanning 195 units and $23,244 in fee refunds across 207 units, according to Montgomery County. Staff also negotiated average reductions that translated to about $445.82 in monthly savings for month‑to‑month tenants.
Officials point to the county’s FY25 Troubled Property Report as backup for their case. They highlight declines in the number of units labeled “Troubled” and “At‑Risk,” saying the trend shows more landlords are fixing violations rather than trying to recoup costs through big rent hikes.
Developers and planners push back
Planners and developers see a different story unfolding in the construction pipeline.
The planning department’s Development Pipeline Analysis, built on a developer survey and staff review, concludes the rent‑stabilization rules have had a “chilling effect” on some multifamily projects and urges changes aimed at getting more buildings out of the ground. The analysis counts roughly 26,900 unbuilt units that already have planning approvals and suggests shifting the law’s rolling 23‑year exemption to a fixed cutoff. Staff recommend exempting projects built after 2002 to give investors more certainty, according to the Planning Department.
Developers told staff that permitting slowed starting in spring and summer 2024 and that lining up financing has become tougher in the current policy environment.
Data and politics collide
How people interpret the law often depends on which metric they care about most: enforcement outcomes and code compliance, or near‑term construction starts.
Housing advocates and some independent analysts emphasize that Troubled Property counts dropped sharply in FY25, a shift they tie to a combination of code enforcement and rent stabilization. The National Low Income Housing Coalition reviewed the FY25 Troubled Properties data and flagged the large year‑over‑year declines in units marked “Troubled” and “At‑Risk,” suggesting many landlords chose to address poor conditions to avoid rent restrictions, according to the National Low Income Housing Coalition.
What’s next
Planning staff have sent their recommendations to the County Council, which now has to decide whether to rewrite parts of the law to address development concerns. Any changes would go through public hearings and comment periods and would almost certainly become a marquee political issue in upcoming local races.
For now, county leaders and housing groups say they will keep tracking permit activity, enforcement results and how quickly projects move from the paper pipeline to actual construction sites.
Tenants who believe they were overcharged or who want to challenge a proposed increase can call MC311 at 240‑777‑0311 or review Montgomery County DHCA’s Rent Stabilization resources for information on notice rules, petitions and mediation. The ORS report says staff have been hosting outreach events and mediating disputes in an effort to resolve problems before they end up in court.
