Chart of the week: Tax assessment trends for rent controlled housing

Asset values are a key indicator of property performance, investment potential, and the long-term viability of housing providers. They influence property tax liabilities, access to financing, and the capacity of owners to reinvest in their buildings. Understanding the dynamics of asset value growth is particularly important in cities like D.C. with aging housing stock and a significant share of regulated units.

“Assessing the role of small housing providers in the District of Columbia,” a recently published report from The Wilkes Initiative for Housing Policy, highlights the critical role of small housing providers, those who own between five and 50 units. In D.C., 84% of all housing providers fall into this category, and they own a disproportionate share of rent controlled units. Small housing providers are integral to the affordable housing market in D.C., and they face greater financial constraints.

This analysis shows that rent controlled properties have appreciated at roughly half the rate of market rate buildings over the past decade. A comparison of 2015 tax assessments to proposed assessments in 2025,¹ excluding buildings that opened after 2015, reveals that in the last ten years, market rate rental apartment buildings have grown in value (not adjusted for inflation) by an average of 5.44 percent every year, or 54 percent since 2015. In the same period, rent controlled buildings grew by 2.5 percent annually or 25 percent since 2015. Slower appreciation is partially attributable to the older age and limited amenity offerings of rent controlled stock. Most rent controlled buildings opened prior to 1976 and have not undergone major reinvestment, especially those owned by smaller providers who have less access to capital and face higher per-unit operating costs.

Tax-assessed values also diverged based on the scale of ownership. Properties owned by small providers—those managing between 5 and 50 units—experienced significantly higher growth in assessed value than those owned by large landlords. Market rate properties owned by small providers grew by nearly 16 percent per year, three times the overall average, while rent controlled properties owned by small owners grew by an of 4.24 percent per year, nearly double the average for rent controlled stock. However, it is important to interpret these results with caution: the sample size for small owner, market rate properties is relatively small, and may not reflect broader market trends.

For large property owners, assessment growth closely tracked overall averages for both market rate and rent controlled buildings. This is unsurprising, given that large owners account for 97 percent of market rate units and 85 percent of rent controlled units captured in this analysis.

The uneven appreciation of rent controlled assets—particularly in neighborhoods with limited new development—has implications for long-term affordability and housing supply. While the decentralized nature of ownership has historically supported affordability, it also increases systemic vulnerability. Many small providers report financial strain, with some exiting the rental market entirely, contributing to the loss of thousands of rent controlled units since 2006. Understanding how asset value trajectories differ by ownership type and regulatory status is essential for designing interventions that preserve affordability, support small-scale providers, and ensure the continued viability of the District’s rent controlled housing stock.

While rent controlled buildings generally appreciate at a lower rate than market rate buildings, this trend varies across the city. Comparing the assessed growth of rent controlled properties to the assessed growth of market rate properties in the last decade,² Wards 7 and 5 see the highest relative discount on property values for rent controlled units. In contrast, Ward 6 saw faster growth in rent controlled building values relative to market rate. However, this finding is based on a very limited sample—only eight rent controlled buildings and two market rate buildings were continuously operational in both 2015 and 2025; the result may reflect a statistical anomaly rather than a broader trend.

Data Appendix

1. Buildings were matched by SSL using an inner join, meaning that only buildings that existed in the tax database 2015 were captured in this analysis.
2. We compared assessed growth by property type (rent controlled and market rate) by tax assessment neighborhood. Neighborhoods which only had one property type were excluded from the analysis. Growth was then aggregated by Ward. A full list of neighborhoods and assessed values can be found in the appendix.