WILMINGTON — An amended ordinance that would cap rent increases in Wilmington is set for a vote on Thursday night, despite pushback from local landlords and economic development leaders.
Ordinance 25-016 would cap rent increases to 3% of the most recent rent base or the 12-month average of the area Consumer Price Index, whichever is lower. The ordinance, if it passes, would not apply to student housing, first time rental units and the first 10 years of a new building.
It would also create a Housing Stability Committee, which would monitor the rent control policy, collect data on housing costs and recommend long-term solutions.
More than half of Wilmington residents are renters, but inflation and rising costs have driven housing costs up. The 2022 Delaware Statewide Housing Needs Assessment found that renter income has risen at a slower rate to keep up with the rent in all markets except Sussex County.
The report found that the income of a renter in Wilmington grew by 10% between 2019 and 2022 but rent rose 12% in the same time period.
Councilwoman Shané Darby proposed the ordinance and told the Delaware Business Times that it was “a collaborative bill between the council, landlords and renters.” Late in May, she amended the ordinance to raise the percent cap to 5% offer more flexibility to landlords, as well as allowing an additional landlord and real estate representation on the Housing Stability Committee.
“I have received input from all sides and crafted a compromise that reflects everyone’s concerns. Rent stabilization is about slowing down the displacement of families while we work toward long-term solutions for affordable housing in our city,” Darby said in a text message.
Mayor John Carney is against the ordinance as he “believes it is not an effective tool” to ensure housing stability. Carney spokesman Matt Ford said that his administration has concerns that rent caps would place more regulations for the Office of Licensing and Inspections and cut off interest in building more homes.
“Mayor Carney advocates for alternative solutions, such as increasing the supply of affordable housing, as more effective means to address the city’s housing challenges,” Ford said in an email to the Delaware Business Times on Wednesday.
The move to rent control was welcomed by affordable housing advocates like Branden Fletcher. During a city council meeting on May 29, he maintained that the ordinance would grant guardrails on a rental market that was “spiraling out of control.”
“Rents [in Wilmington] have increased 30% in just a few years. Meanwhile wages have barely moved, and families are spending more than half their income to stay housed,” Fletcher said. “This is not sustainable. It’s an eviction crisis that’s leading to a homelessness crisis.”
But local landlords argued that the ordinance overall would be detrimental to the “small landlords” that would lock them into artificially low rents and possibly lower property values for owners and tenants. Renee Spruiel, who leases out property in Quaker Hill and Hilltop, testified at the May 29 meeting that many of her tenants stay because she works with their needs.
“I communicate with them, I listen to their needs, and I address their repairs as needed. We don’t constantly turn over rental units because it’s an excessive cost. I can say that it’s cost me double to turn over a rental unit than it did five years ago,” she said. “I had tenants with me for 15 years and I’m below market right now. If this bill goes through, I will not be able to raise it to the fair market.”
Jacqueline Flowers, who works at EDiS but started renting out properties with her husband in 2023, said during the hearing last week that it’s unlikely they would be able to keep up properties to the standard they have if the rent control ordinance passes.
“If you take away our rights as property owners. . . we will be forced to max the increase each year and deny the cosmetic changes our renters look forward to. If an emergency happens, we will be forced to sell and you will lose a proud Wilmington business owner,” Flowers told the committee.
The Committee of 100 has also come out against the ordinance, pointing out that after three years, a rent control measure was rolled back in St. Paul, Minn. In the three years when it was in effect, 80% fewer housing units were built than the previous three-year average.
“At the end of the day, this is going to lower the housing supply and discourage investment,” Committee of 100 Executive Director Matt Dougherty said. “If you look at cities that repeal the rent cap, the supply usually explodes. This is well-intentioned, but in the long run, it doesn’t solve the affordable housing crisis.”
