Citi sees little financial risk to apartment REITs from reported Biden plan

Citi notes The Washington Post has reported that President Biden plans to unveil a plan to temporarily cap rents on apartments for two years as a bridge to help renters until there’s more supply in later years. While it is unclear if the plan would be applicable to the REITs, the rent limits for others would potentially impact REIT’s pricing, but given that the plan reportedly needs to be “approved by Congress,” the firm would see little chance of it passing in the near-to-medium term. The firm sees little financial risk to rental REITs based on the details of the plan provided thus far, added Citi. Publicly traded companies in the space include AvalonBay (AVB), Equity Residential (EQR), Essex Property Trust (ESS), UDR (UDR), Camden Property (CPT) and MAA (MAA).