    [Senate Hearing 118-579]
    [From the U.S. Government Publishing Office]

                                                            S. Hrg. 118-579

                       EXAMINING COMPETITION AND CONSUMER
                           RIGHTS IN HOUSING MARKETS

    =======================================================================

                                    HEARING

                                   BEFORE THE

                        SUBCOMMITTEE ON COMPETITION POLICY,
                           ANTITRUST, AND CONSUMER RIGHTS

                                     OF THE

                           COMMITTEE ON THE JUDICIARY
                              UNITED STATES SENATE

                        ONE HUNDRED EIGHTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                                OCTOBER 24, 2023

                                   __________

                              Serial No. J-118-37

                                   __________

             Printed for the use of the Committee on the Judiciary

    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

                            www.judiciary.senate.gov
                                www.govinfo.gov

                                     __________

                       U.S. GOVERNMENT PUBLISHING OFFICE
    58-973                      WASHINGTON : 2025

    -----------------------------------------------------------------------------------

                           COMMITTEE ON THE JUDICIARY

                       RICHARD J. DURBIN, Illinois, Chair
    SHELDON WHITEHOUSE, Rhode Island     LINDSEY O. GRAHAM, South Carolina,
    AMY KLOBUCHAR, Minnesota                     Ranking Member
    CHRISTOPHER A. COONS, Delaware       CHARLES E. GRASSLEY, Iowa
    RICHARD BLUMENTHAL, Connecticut      JOHN CORNYN, Texas
    MAZIE K. HIRONO, Hawaii              MICHAEL S. LEE, Utah
    CORY A. BOOKER, New Jersey           TED CRUZ, Texas
    ALEX PADILLA, California             JOSH HAWLEY, Missouri
    JON OSSOFF, Georgia                  TOM COTTON, Arkansas
    PETER WELCH, Vermont                 JOHN KENNEDY, Louisiana
    LAPHONZA BUTLER, California          THOM TILLIS, North Carolina
                                         MARSHA BLACKBURN, Tennessee
                 Joseph Zogby, Chief Counsel and Staff Director
          Katherine Nikas, Republican Chief Counsel and Staff Director

               Competition Policy, Antitrust, and Consumer Rights

                        AMY KLOBUCHAR, Minnesota, Chair
    SHELDON WHITEHOUSE, Rhode Island     MICHAEL S. LEE, Utah, Ranking
    CHRISTOPHER A. COONS, Delaware           Member
    RICHARD BLUMENTHAL, Connecticut      CHARLES E. GRASSLEY, Iowa
    MAZIE K. HIRONO, Hawaii              JOSH HAWLEY, Missouri
    CORY A. BOOKER, New Jersey           TOM COTTON, Arkansas
    PETER WELCH, Vermont                 THOM TILLIS, North Carolina
                                         MARSHA BLACKBURN, Tennessee
                   Keagan Buchanan, Democratic Chief Counsel
                      Wendy Baig, Republican Chief Counsel

                               C O N T E N T S

                                  ----------

                               OPENING STATEMENTS

                                                                       Page

    Klobuchar, Hon. Amy..............................................     1
    Lee, Hon. Michael S..............................................     3

                                   WITNESSES

    Antoni, E.J......................................................    11
        Prepared statement...........................................    32

    Calder, Vanessa Brown............................................     8
        Prepared statement...........................................    43

    Quintero, Luis E.................................................    10
        Prepared statement...........................................    47

    Stucke, Maurice E................................................    13
        Prepared statement...........................................    51

    Yentel, Diane....................................................     7
        Prepared statement...........................................    65

                                    APPENDIX

    Item submitted for the record....................................    31

                       EXAMINING COMPETITION AND CONSUMER
                           RIGHTS IN HOUSING MARKETS

                                  ----------

                           TUESDAY, OCTOBER 24, 2023

                          United States Senate,
    Subcommittee on Competition Policy, Antitrust, and
                                       Consumer Rights,
                                    Committee on the Judiciary,
                                                        Washington, DC.
        The Subcommittee met, pursuant to notice, at 2:37 p.m., in
    Room 226, Dirksen Senate Office Building, Hon. Amy Klobuchar,
    Chair of the Subcommittee, presiding.
        Present: Klobuchar [presiding], Blumenthal, Hirono, Lee,
    Hawley, and Blackburn.

                OPENING STATEMENT OF HON. AMY KLOBUCHAR,
               A U.S. SENATOR FROM THE STATE OF MINNESOTA

        Chair Klobuchar. I don't know why we'd be discussing the
    House right now. I don't know, when we have this excitement
    right in our Chamber.
        But I want to welcome everyone----
        [Gavel is tapped.]
        Chair Klobuchar [continuing]. To this very important
    hearing and I'm actually really excited to hear from our
    witnesses. I would like to thank Ranking Member Lee and his
    staff for working with us to plan this hearing.
        So everyone looks back fondly maybe at the first place they
    ever lived.
        For me, in 1960, my parents wallpapered the last room in
    their house on a dirt road on 1315 Oakview Lane in Plymouth,
    Minnesota. I still remember that my whole time growing up, we
    lived in the same house and it had exposed wood ceilings. I had
    no dishwasher to the end. But it had exposed wood ceilings.
        And my grandma who grew up on the iron range of Minnesota
    would come down to the cities to see the house. And she would
    every single time, my grandma, Mary Klobuchar, say to my mom
    and dad, ``When are you going to finish the ceiling?''
        [Laughter.]
        Chair Klobuchar. And the brightly colored appliances--
    butter yellow-colored oven that was all part of our lives. And
    my dad paid for that house with a GI loan.
        And today, I think we all know that houses are not
    available to many young families in the same way that my
    parents could afford them on a teacher's salary and a starting
    newspaper reporter's salary.
        In 1960, the median home value was $11,900. That is about
    $123,000, in today's dollars. And this was, of course, in the
    midst of the post-war housing boom.
        Today, the median single-family home costs more than
    $400,000, if you look at it across America. This is an increase
    of more than 500 percent since 1980, and more than 40 percent
    since 2020.
        I think we know why this is. Affordable options are too
    few. Freddie Mac estimates that we need to build 3.8 million
    new homes to make up for the housing deficit.
        And according to the National Low Income Housing Coalition,
    the affordable housing gap for those with low incomes is more
    than 7.3 million rental units.
        We know rents have always gone up, jumping more than 12
    percent since August of 2022 alone. And in some 20 million
    households, they spend more than half of their income on
    housing.
        So what do we do? The affordable housing crisis is a result
    of complex, long-standing issues--many of which are the focus
    of our colleagues over in the Banking, Housing, and Urban
    Affairs Committee, chaired by Senator Sherrod Brown, and Tina
    Smith, my colleague, chairs the Subcommittee.
        We know there's issues of workforce to build housing.
    There's issues of the cost of building housing and the
    component parts. But today we're going to focus on the role
    that competition policy changes, to help address these market
    failures.
        So some of the issues I'll put on the table that are
    relevant to our Committee.
        First, renters face real challenges to compare and contrast
    prices. More and more of the cost of renting are hidden from
    view through the proliferation of junk fees. As a result,
    renters struggle to take advantage of price competition because
    the true costs of housing are not transparent.
        Second, housing is an area in which we have seen the
    widespread use of algorithmic pricing tools designed to raise
    prices even at the expense of higher vacancy rates. A growing
    number of companies, like RealPage and Yardi offer services
    that collect competitively sensitive pricing information from
    competing property management committees, feed that data
    through sophisticated algorithms, and recommend unit by unit
    prices so landlords can charge a certain rent.
        Landlords have figured out that it is better for them and
    their bottom lines to use these products to price units high,
    so that some of them actually sit empty, but it is easier to
    have them priced high for them in the long term.
        And so I believe landlords should be competing on price.
    And I don't think you see that happening when you have this
    algorithm-based games going on.
        Third, families are being boxed out of the market for
    single family homes by institutional investors. There've been
    wide range news reports about this, where institutional
    investors will just buy up homes in a neighborhood making it
    out of reach, especially for first-time home buyers.
        The institutional buyers are often backed by large private
    equity funds seeking reliable revenues through rental income
    instead of allowing families to achieve the dream of home
    ownership.
        The presence of these institutional actors drives up home
    prices because they can make all-cash offers and waive
    inspections to outbid everyday people.
        And unlike mom and pop landlords, these absentee owners are
    more likely to charge junk fees, evict families, and increase
    instability in our communities.
        Finally, this is all made worse by the fact that we are not
    building enough affordable housing. The number of starter homes
    being built has plummeted since the 2008 financial crisis,
    which put hundreds of thousands of small builders out of
    business. This has left us reliant on fewer and fewer large
    company home builders that dominate home building in major
    metropolitan areas.
        The builders tend to focus on high-end homes rather than
    starter homes. The consolidation in the home building market
    has been shown to reduce the number of new homes built by more
    than 100,000 houses every single year.
        So while we recognize a competition policy is no silver
    bullet--and I will emphasize that as we talk about I'm sure
    some of the other issues at hand--while it is no silver bullet
    for solving our affordable housing crisis, we shouldn't dismiss
    its importance. We should at least explore it and look at what
    possible solutions we can agree on.
        The antitrust laws were actually used in the 1960s to make
    sure that there was fairness in sales of homes. And we now need
    to examine whether antitrust and consumer protection laws need
    to be updated to eliminate predatory junk fees for rental
    markets, root out anticompetitive tools that facilitate price
    fixing instead of competition, and ensure the market is more
    responsive to the increased demand for housing.
        I look forward to exploring these issues with my colleagues
    and our esteemed witnesses today. I now turn it over to Senator
    Lee.

               OPENING STATEMENT OF HON. MICHAEL S. LEE,
                 A U.S. SENATOR FROM THE STATE OF UTAH

        Senator Lee. Thank you, Madam Chair. Thanks to all of you
    for coming. This is an important issue and I'm glad we're
    holding the hearing.
        Millions of Americans all across the country, including so
    many in my own home State of Utah, are paying significantly
    higher prices to own, rent, or otherwise live in a home in
    2023.
        Home ownership is even further out of reach for Americans
    than it has been at any other time in modern history. And this
    has created problems, problems that we hope to address and
    discuss today.
        Just since July of 2021, just over 2 years ago, the
    affordability of a home has declined significantly even in that
    narrow timeframe.
        According to the Home Ownership Affordability Monitor,
    housing accounted for about 28 percent of Americans' median
    income in January of 2021. It's a lot of money that's up then
    from what it had been just a few years earlier and when it used
    to be much lower than that.
        But, you know, it's a sizable chunk. People were spending
    over a quarter--between a quarter and a third of their income
    on housing.
        But let's look at what happened since then. It's jumped to
    a whopping 44 percent by September of 2023. These rates are
    worse than those seen during the financial crisis of 2008.
    Homes are less affordable today than at any other time since we
    started keeping track of this particular set of records back in
    2006. We've never seen anything this bad since we began keeping
    those records.
        The monthly mortgage payment on a median price home has
    more than doubled, in just 2 years. In 2021, it was $979.
        Well, today that payment is $2,059. It costs a family
    almost $13,000 more per year to live in the same house than it
    did just over 2 years ago, 2\1/2\ years ago, the moment our
    current President took office. And with rents at record highs,
    many Americans have limited housing options available to them.
        If Americans are spending 44 percent of their income--close
    to half of what they make--on housing, and $13,000 more per
    year than they did just 2 years ago, it leaves families with
    less income, fewer resources, and less savings left over to pay
    for basic essentials, such as groceries, gasoline, cars--all of
    which have become dramatically more expensive at the exact same
    time that housing has become unaffordable.
        So with less ability to pay for these basic needs, there
    isn't money left over from anything else. Anything else,
    whether that's an emergency, you know, unforeseen expense
    related to a car repair or a health condition, a family member
    who needs help or a desire to go on a family vacation, or buy
    something that the family needs. There isn't room for it,
    because everything else has been taken up.
        And ultimately, the increased share of a family's income
    spent on housing may cause them to take on even more debt to
    make ends meet. And this, in turn, over time, it's going to
    lead to more bankruptcies.
        Many failures may contribute to the sudden abrupt and
    severe rise in housing costs. We've got a number of things that
    we could look at.
        The first one I want to mention involves State and local
    regulations, which account for a significant constraint on
    housing supply. Anytime we look at the price of a particular
    thing, whether it's a good or a service or something as basic
    as a home, you have to look at supply and demand, and how those
    two are interacting.
        And these things, these regulations impose significant
    constraints on housing supply at the same time when demand is
    hardly going away. And in many States, like Utah, it's
    increasing rather abruptly and dramatically.
        In cities across America, residents are burdened with
    zoning and overburdensome land use regulations at the Federal,
    State, and local levels. And these regulations decrease the
    housing supply and in many cases directly prohibit housing
    development, increase costs, create uncertainty, and they
    produce significant delays.
        For example, the Affirmatively Furthering Fair Housing Rule
    originally adopted by the Obama administration, increased
    compliance costs and the cost of housing by an additional--by
    adding additional Federal zoning restrictions.
        Those restrictions aren't always things that show up as
    obviously the product of Federal action, because they translate
    into these local units of Government adopting new regulations,
    new restrictions in response to the AFFH rule--because they
    have to comply with those rules in order to continue receiving
    Federal funds, for example, under the Community Development
    Block grant program.
        And it appears that the same will be true of the Biden
    administration's version of the same rule, which has not yet
    taken effect, but will soon.
        Second, Americans are suffering through an extended period
    of high inflation generally, which has been particularly acute
    in the housing market.
        Throughout 2021, the inflation rate jumped to as high as 9
    percent, more than four times the Federal Reserve's target
    inflation rate of 2 percent, in large part due to profligate
    Federal spending and irresponsible monetary policy.
        Home prices rapidly increased over the last five decades,
    eclipsing the inflation rate by 150 percent since 1970. In
    fact, if home prices grew at the same rate as inflation, since
    1970 the median home price today would be just $177,788--rather
    than $408,100.
        Finally, the Federal Government's land ownership is also a
    critical factor, especially in parts of the United States like
    Utah, a home to vast swaths of Federal land in holdings. In
    2021, the States with the highest increases in home prices year
    over year, were--not coincidentally--Arizona at 28.8 percent,
    Idaho at 28.7 percent, and Utah at 24.5 percent.
        This comes to as no surprise to us in the West. The Federal
    Government owns a really obscenely large percentage of our
    land.
        In Utah, the Federal Government owns about 67 percent of
    all the land in Utah. That's two thirds.
        While a small portion of this land consist of scenic
    National Parks, most Federal land in the West is managed by the
    Bureau of Land Management or the U.S. Forest Service--and most
    of it doesn't look like the postcard-worthy, picturesque
    viewscapes that you see associated with National Parks.
        It's just land. Land that the Federal Government owns,
    holds, refuses to sell, refuses to allow development on, and
    very often is used to lock people out of access to all kinds of
    things in the State, including, on occasion, their own
    property.
        Now the United States now has a record shortage of over 5
    million homes. In 2021, the States with the highest increases
    in home prices were located in the West.
        Unfortunately, finding available land to increase housing
    supply is a real struggle. I mean it's very, very difficult,
    simply because it's not there. Because we don't have very much
    of this rare commodity known as private land, and you have to
    have private land in order to build housing.
        So I've introduced a bill called the Houses Act, which
    would create a process by which local communities could
    nominate small tracts of run of the mill BLM-managed land to be
    used to quickly address housing shortages and availability. And
    these are in holdings that are in or immediately outside of a
    city or town boundary, a place where people live.
        The Houses Act would help solve Utah's land and housing
    scarcity by allowing parcels of Federal land to be purchased by
    a State or a unit of local government at a reduced price,
    giving them much needed flexibility to address housing
    constraints.
        The Act would require that land be subject to a density
    requirement, and would protect against the development of
    expensive second homes purchased from the Federal Government on
    the parcels at issue.
        Now in Utah, there are almost 23 million acres of Federal
    land that happen to be managed by the Bureau of Land Management
    in the State, accounting for 43.24 percent of the total land in
    the State.
        Typical home prices in Utah have increased by 89 percent
    just over the last 5 years--89 percent in 5 years.
        If just 1 percent of the acreage in Utah managed by the
    Bureau of Land Management in my State were made available for
    housing under the Houses Act, at least 774,000 additional homes
    could be built. We have large families in Utah, and we
    reproduce rapidly, so we're going to need those homes.
        This hearing is intended to examine some of the factors
    contributing to the increased costs of homes, specifically some
    of the factors that Members of the Subcommittee might be able
    to help mitigate or potentially eliminate, and I look forward
    to this conversation. Thank you.
        Chair Klobuchar. Very, very good.
        I note we've been joined by Senator Blumenthal, who got in
    at 3 a.m. from a trip to the Mideast. So it's a total devotion
    to our Subcommittee, as well as Senator Hirono, I look forward
    to hearing from, given the loss of homes in the Maui fires. And
    I know she'll be focused on that. Thank you.
        We have with us our witnesses.
        Diane Yentel is the president and CEO of the National Low
    Income Housing Coalition. She's worked in affordable housing
    for over 25 years.
        Vanessa Brown Calder is the director of Opportunity and
    Family Policy Studies at the Cato Institute. She previously
    served as executive director and staff director at the Joint
    Economic Committee under Senator Lee. Cool.
        Luis Quintero is with us. He is an assistant professor at
    Johns Hopkins Carey Business School with a Ph.D. in economics
    from Carnegie Mellon University. His research focuses on real
    estate, economics, and housing affordability.
        E.J. Antoni is a research fellow at the Heritage
    Foundation's Grover M. Hermann Center for the Federal Budget.
        And Maurice Stucke is the Douglas A. Blaze Distinguished
    Professor of Law at the University of Tennessee College of Law,
    where his teaching and research focuses on competition and
    antitrust law and policy. And he recently served as a senior
    advisor to the FTC and has spent years litigating antitrust
    matters with the Department of Justice.
        So with that, I'm going to swear in the witnesses. Here we
    go. If you guys could rise.
        [Witnesses are sworn in.]
        Chair Klobuchar. Thank you. You can be seated. Now we will
    begin. So you can get started, Ms. Yentel. Thank you.

       STATEMENT OF DIANE YENTEL, PRESIDENT AND CHIEF EXECUTIVE
     OFFICER, NATIONAL LOW INCOME HOUSING COALITION, WASHINGTON, DC

        Ms. Yentel. Thank you. Chair Klobuchar, Ranking Member Lee,
    and Senator Hirono, thank you for the opportunity to testify
    today.
        Across the nation, the lowest income renters face a severe
    shortage of affordable and available homes, and a significant
    gap between incomes and housing costs. There is a national
    shortage of 7.3 million homes that are affordable and available
    to the lowest income renters.
        This shortage is a long-standing structural feature of the
    country's housing system, consistently impacting every State
    and nearly every community. For example, in both Chair
    Klobuchar's State of Minnesota and Ranking Member Lee's State
    of Utah, there are fewer than four affordable homes available
    for every 10 of the lowest income renter households.
        Without affordable housing options, more than 10 million of
    the lowest income renters, who are disproportionately people of
    color, pay at least half their limited income on rent, leaving
    them without the resources they need to put food on the table,
    purchase needed medications, or otherwise make ends meet,
    putting them one financial shock away from facing eviction, and
    in worse cases, homelessness.
        While wages have risen in recent years, these gains have
    not closed the persistent and significant gap between renters'
    incomes and the rising cost of rent.
        During the pandemic, policymakers responded to the growing
    threat of housing insecurity by providing unprecedented support
    to keep renters housed. These protections and resources cut
    evictions in half, lowered eviction filing rates to the lowest
    on record, and kept millions of people, who otherwise would've
    lost their homes during the pandemic, stably housed.
        But just as these emergency resources were depleted and
    pandemic-era renter protections expired, renters reentered a
    housing market with skyrocketing rents and high costs
    elsewhere.
        The GAO has found that every $100 increase in median
    monthly rent, is associated with a 9 percent increase in
    homelessness in that same community.
        Over 2021 and the first half of 2022, rents increased by
    about $200 a month. And as a result, eviction filing rates have
    now reached or surpassed pre-pandemic averages in many
    communities, resulting in increased homelessness.
        Even with the stabilization of rental prices this year, the
    rapid inflation we saw during 2021 and 2022, has done
    significant damage to affordability, especially for the lowest
    income renters.
        Median rent of new leases just last month were 24 percent
    higher than at the beginning of 2021. Rent increases are driven
    by several factors, including a growing demand for rental
    housing and limited supply.
        Rent increases can also be attributed to a mostly
    unregulated rental market with few tenant protections that,
    especially in markets where demand far outstrips supply,
    permits landlords to raise rents as high as the market will
    allow without regard to the impact on tenants with the lowest
    incomes.
        And in addition to high rent, landlords are increasingly
    imposing costly fees, further increasing costs for low-income
    renters. Renters particularly those with the lowest incomes,
    have severely limited options in the housing market. The lack
    of national renter protections leaves tenants vulnerable to
    unjust treatment, housing instability, and evictions.
        Landlords can engage in abusive and predatory behavior with
    few consequences. Renters facing exorbitant rent increases or
    excessive fees, have little to no ability to move to a new
    home. Instead, they can face retaliation for reporting unsafe
    housing conditions or illegal actions by landlords. And because
    so few renters have access to legal representation, many are
    unable to assert their legal rights.
        Strengthening and enforcing Federal renter protections is a
    critically needed solution to America's housing crisis, along
    with eliminating restrictive local zoning laws to increase
    supply, increasing investments to make homes affordable to
    people with the lowest incomes through expansions of housing
    choice vouchers and the National Housing Trust Fund, and
    preventing evictions and homelessness with a National Housing
    Stabilization Fund.
        Thank you, again, for the opportunity to testify today. I
    look forward to your questions.
        [The prepared statement of Ms. Yentel appears as a
    submission for the record.]
        Chair Klobuchar. Thank you. Ms. Calder.

    STATEMENT OF VANESSA BROWN CALDER, DIRECTOR OF OPPORTUNITY AND
         FAMILY POLICY STUDIES, CATO INSTITUTE, WASHINGTON, DC

        Ms. Calder. Chair Klobuchar, Ranking Member Lee, and
    Members of the Subcommittee, thank you for the opportunity to
    testify today.
        My name is Vanessa Brown Calder, and I am the director of
    Opportunity and Family Policy Studies at Cato Institute. The
    views I express today are my own. They do not represent the
    official position of my employer.
        Accessible low-cost housing is vital to the health and
    prosperity of America's families and communities. When housing
    is abundant, it is more affordable. Abundant housing provides
    educational and economic opportunities. It allows families to
    be part of the communities that they desire. Policies that
    support abundant affordable housing are associated with reduced
    homelessness, and better homeless policy outcomes.
        Although junk fees, institutional investors, and similar
    matters have received some recent attention, inaccessible,
    high-cost housing is largely a result of existing Federal,
    State, and local policy. Government policies that constrain
    housing development are particularly detrimental in this
    regard.
        State and local regulations constitute some of the most
    significant policies constraining housing supply. Zoning and
    land use regulations are nearly ubiquitous across American
    cities.
        These regulations directly prohibit housing development,
    increase costs, create uncertainty, and produce delays. Zoning
    regulations have a meaningful impact on family budgets.
        A well-known paper finds that zoning pushes up the cost of
    apartments by around 50 percent in Manhattan, San Francisco,
    and San Jose.
        A recent paper reviewing 24 metropolitan areas finds a
    massive zoning tax up to $500,000 per quarter acre in cities
    with restrictive land use regimes.
        In addition to State and local policy, Federal policy also
    plays a role in limiting housing supply. In Western States, the
    Federal Government owns a substantial portion of the land which
    cannot be developed. In Nevada, Utah, and Idaho the Federal
    Government owns between 60 and 80 percent of the land. In other
    Western States, the Federal Government owns more than a third
    to a half.
        Contrary to public perception, the vast majority of Federal
    lands are not National Parks, Monuments, or Bureau of Indian
    Affairs land.
        Instead, most Federal western land is managed by the Bureau
    of Land Management or U.S. Forest Service. This land is often
    close to urban areas with a significant portion of land within
    city or county boundaries.
        Presented with a similar set of facts in the 1990s, former
    Senate Majority Leader Harry Reid led a group of legislators in
    passing the Southern Nevada Public Land Management Act. This
    legislation allowed local governments in the landlocked Las
    Vegas area to nominate Federal land for competitive market
    auction.
        The sale of Federal land in Clark County, subsequently
    resulted in hundreds of millions of dollars allocated to Nevada
    public schools and environmental initiatives, creating a win-
    win for Nevada's developers, conservationists, and residents.
        Ranking Member Lee and Co-Sponsors of the Houses Act
    propose extending a similar solution to other Western States.
        The Houses Act would allow local governments to nominate
    and purchase Federal land and develop the land for housing
    projects that meet certain density minimums and other criteria.
        Like the Southern Nevada Public Land Management Act,
    proceeds from the Houses Act would be made available for
    environmental initiatives. Research suggests that the Houses
    Act could have a meaningful impact on housing affordability.
        A recent U.S. Congress Joint Economic Committee study finds
    that Houses reforms could lead to the construction of almost 3
    million homes, and this increase in housing development would
    be possible with a conversion of just 0.1 percent of existing
    Federal land holdings.
        In addition to policies that directly constrain
    development, additional Federal, State, and local policies are
    also relevant to housing affordability.
        When supply-limiting policies are addressed, the
    participation of investors in the housing market will be
    largely inconsequential. Furthermore, the gains that result
    from reforming supply-limiting policies, exceed potential gains
    from regulating junk fees or market participants.
        When considering reforms to improve housing, policymakers
    and analysts should keep in mind that the Government is the
    dominant regulator and player in the housing market.
        As a result, ample reform opportunities exist. Reforms that
    expand housing supply will unleash the housing market and
    ensure that American families have the choice, opportunity, and
    upward mobility that they desire.
        Thank you, and I look forward to your questions.
        [The prepared statement of Ms. Calder appears as a
    submission for the record.]
        Chair Klobuchar. Thank you. Professor.

       STATEMENT OF LUIS E. QUINTERO, ASSISTANT PROFESSOR, JOHNS
             HOPKINS CAREY BUSINESS SCHOOL, WASHINGTON, DC

        Professor Quintero. Chair Klobuchar, Ranking Member Lee,
    and Members of the Committee, thank you for inviting me to
    participate in today's hearing and for your attention to the
    topic of competition and consumer rights in housing markets, an
    issue of critical national importance.
        My name is Luis Quintero. I'm an economist, and have spent
    8 years at Johns Hopkins, where I do research on housing
    markets and policy.
        In my work, I have documented the increasing consolidation
    of housing markets in the United States, and its detrimental
    effects on housing affordability. And I am pleased that this
    Congress is taking a proactive step to incorporate competition
    in the legislative discussion. Concentration in housing markets
    has been growing since the Great Recession.
        This trend follows the long-term decline in competition
    documented in so many other sectors of the U.S. economy.
    Although market consolidation is not the only factor driving
    the housing affordability problem, it is a critical one.
        During the Great Recession, many local and regional home
    builders stopped operations leaving large national builders
    dominant in many local markets. Furthermore, many of these
    large home builders have since merged.
        My work identifies at least 12 mergers that significantly
    increased the market share for the resulting firms. One of
    those cases formed the largest home building company in the
    country. Although national home prices have recovered since
    2011, the number of building firms has not.
        While prices are up by about 30 percent with respect to
    their peak of 2008, the number of for-sale builders is down 80
    percent. The competitive market forces that incentivize entry
    when prices increase are not being realized in American housing
    markets.
        I estimated that 56 percent of markets exhibit
    concentrations that would fall into the category of highly
    concentrated as defined by the FTC. Most of the gains in market
    shares in recent years come from the increase in the activity
    of 2 home builders.
        Large mergers in this sector have most likely not been
    challenged because regulating authorities may not be defining
    relevant housing markets narrowly enough.
        The whole country is not a single housing market. For
    example, home building in Pittsburgh or Cleveland is not a
    threat to the ability of a hypothetical monopolist to impose a
    significant and non-transitory increase in price in
    Philadelphia.
        Accordingly, housing markets must be correctly spatially
    defined to ensure estimated market shares are useful in
    assessing concentration.
        We should care about market consolidation because it
    affects housing supply and affordability. My estimates predict
    that if we had kept the 2006 levels of competition, the U.S.
    would've built 112 billion more last year--equivalent to
    approximately 160,000 additional units. This roughly equals to
    10 percent of the private residential fixed investment
    predicted for 2023.
        We should encourage agencies to enforce competitive policy
    in housing markets more effectively, and ask housing policies
    to incorporate market structure considerations.
        I would like to offer six recommendations for this
    Committee's consideration.
        First, encourage regulatory agencies to carefully define
    local housing markets spatially when revising mergers.
        Two, consider legislation that shifts the burden of proof
    to home building companies in large scale mergers, asking them
    to show they cannot exert monopoly power in any local relevant
    market where they have building activity.
        Three, encourage enforcement agencies to request mandatory
    divestitures in markets where a merger will cause high
    concentration.
        Four, encourage the Federal Government to make increasing
    competition a pillar of housing policies. For example, by
    requiring a minimum number of home builders participating in
    areas that get low income housing tax credits.
        Five, encourage the same for statewide policies. Recent
    initiatives to relax restrictive zoning may be ineffective if
    local developers can just withhold production by exercising
    monopoly power.
        And six, when considering the Philadelphia National Bank
    presumption, make sure market shares are defined using relevant
    spatial definitions of local housing markets.
        Thank you, and I would be pleased to answer any questions
    you may have.
        [The prepared statement of Professor Quintero appears as a
    submission for the record.]
        Chair Klobuchar. Well, thank you very, very much. Mr.
    Antoni.

        STATEMENT OF E.J. ANTONI, RESEARCH FELLOW, THE HERITAGE
                       FOUNDATION, WASHINGTON, DC

        Mr. Antoni. Chair Klobuchar, Ranking Member Lee, Members of
    the Subcommittee, thank you for the invitation to discuss with
    you today the current state of competition in the housing
    market, and the impact public policy has had on the American
    consumer.
        I'm a public finance economist at the Heritage Foundation
    where I research fiscal and monetary policy. I'm also a senior
    fellow at the Committee to Unleash Prosperity.
        Americans today are facing historic challenges to achieving
    the American dream of home ownership, a dream which might now
    be better described as a nightmare.
        Home ownership affordability is arguably at a record low
    today, with 43.8 percent of the median household before tax
    income needed to purchase the median price home.
        In several major metropolitan areas of the country, over
    100 percent of the median household after tax income is needed
    to purchase the median price home. A recent report showed that
    a median price home is unaffordable for the average income
    earner in 99 percent of the 572 counties examined.
        Another report indicates that a potential home buyer needs
    an annual income over 50 percent higher than the median
    household income to afford a median price home, which is a
    record high.
        While recent data shows that home ownership is 70 percent
    more expensive today than renting--the largest spread in 23
    years--rent prices are also at record highs according to a
    variety of data, including figures from the Bureau of Labor
    Statistics.
        The unaffordability of housing today has largely been
    caused by public policy. By manipulating interest rates to
    facilitate spending and borrowing by the Treasury Department,
    the Federal Reserve created disruptions in the economy.
        The unprecedented size of fiscal and monetary interventions
    in the last 3 years made the magnitude of these disruptions
    historic. The creation of trillions of dollars predictably
    spawned 40-year high inflation, which caused prices everywhere
    to rise.
        Low interest rates also made increasingly larger mortgages
    affordable, which drove home prices to new highs. Because
    interest rates were held so much lower than their natural
    equilibrium, investments, which would not ordinarily be
    profitable, suddenly became so.
        Institutional investors were able to buy swaths of housing
    for the purpose of renting. When the Federal Reserve belatedly
    raised interest rates to reduce the inflation it had helped
    cause, financing costs rose dramatically, especially for
    mortgages.
        Fixed interest rates on 30-year mortgages have more than
    tripled from their lows only a few years ago, and the monthly
    mortgage payment on a median price home has more than doubled
    since January, 2021. While higher interest rates put downward
    pressure on home pricesc, that is being countered today by at
    least two factors.
        First, most existing homeowners cannot afford to sell their
    home because doing so would mean losing a mortgage with a rate
    of 2 to 3 percent in exchange for a new loan at 7 to 8 percent.
    That would drastically reduce the size of the loan, sometimes
    by half, that the borrower could afford on the new home.
        Thus, the supply of existing homes has been severely
    hamstrung--so much so that the price premium on new homes has
    been reduced almost to zero.
        Second, the price indexes faced by home builders are at or
    near record highs. Home builders therefore cannot afford to
    lower their prices. A new home at an affordable price for the
    median household, would be priced below the home builder's
    profitability threshold, so those homes simply aren't being
    built. Thus, the supply of new homes has also been curtailed,
    putting additional upward pressure on prices, even as interest
    rates continue rising.
        The unaffordability of home ownership has forced many
    Americans to rent, and that shift in demand coupled with
    inflation, has increased the price of renting.
        While algorithmic pricing aids have come under scrutiny
    recently amid accusations of their role in higher rent prices,
    there is no empirical evidence that such tools have increased
    prices absent collusion among landlords. An act which is
    illegal, whether algorithmic pricing aids are used or not.
        There is even reason to believe that algorithmic pricing
    aids reduce rents for the marginal renter.
        Additionally, while the purchase of homes by institutional
    investors have reduced the supply of homes for sale and
    increased home prices, it has also increased the supply of
    homes for rent and decreased rent prices.
        Unfortunately, public policy mistakes have created a
    situation where an entire generation of Americans may never be
    able to afford their own home, persistent inflation has made it
    almost impossible for many Americans to ever afford a down
    payment large enough for the monthly payments on a mortgage to
    be affordable.
        The solution is a drastic reduction in the amount of money
    that the Federal Reserve creates and that the Congress spends.
        If there is an antitrust problem regarding housing, it is
    the monopoly control of the Nation's money supply.
        Thank you, and I look forward to your questions.
        [The prepared statement of Mr. Antoni appears as a
    submission for the record.]
        Chair Klobuchar. Very good. Thank you very much, Dr.
    Antoni. Next up, Professor Stucke.

    STATEMENT OF MAURICE E. STUCKE, DOUGLAS A. BLAZE DISTINGUISHED
       PROFESSOR OF LAW, UNIVERSITY OF TENNESSEE COLLEGE OF LAW,
                          KNOXVILLE, TENNESSEE

        Professor Stucke. Thank you so much for inviting me to
    testify today.
        So what does antitrust have to do with the concerns in the
    housing market?
        Now, you already heard about mergers increasing
    concentration in the home building market, and another concern
    that my colleague here mentioned is algorithmic collusion.
        Many of the Nation's larger property managers rely on
    pricing algorithms provided by RealPage and Yardi. Property
    managers using RealPage's algorithm, for example, saw their
    revenues increase on average 3 to 4 percent, while their
    occupancy rates declined from 97 to 95 percent.
        One economic study found the same thing in geographic
    markets where property managers increasingly relied on
    algorithms for their rent, namely higher rents, on average 3
    percent higher, and lower occupancy rate than markets where
    pricing algorithms were in prevalent after controlling for
    observable market characteristics and local market conditions.
        So after Heather Vogell's ProPublica article, there have
    been now over 20 antitrust lawsuits brought against RealPage
    and some of the Nation's largest property developers.
        They're all in the Middle District of Tennessee, and all of
    the lawsuits alleged that RealPage colluded with property
    developers to raise rents and reduce output.
        So one issue for you is, can the antitrust laws effectively
    punish and deter this alleged anticompetitive behavior?
        And the short answer is, yes, if humans agreed among
    themselves to fix price, and RealPage's pricing algorithm was
    then used to facilitate their collusion.
        But the antitrust law as currently applied by the courts,
    cannot punish and deter this anticompetitive behavior in three
    scenarios.
        First, is tacit algorithmic collusion. This is where the
    algorithms learn to tacitly collude without any agreement.
        Second is what--is a hub and spoke algorithmic collusion
    scheme where rivals gradually drift to one algorithm without
    any agreement among the rim.
        And then third, is what we call secondary tacit collusion,
    where rivals rely on several different hubs for their pricing,
    but those hubs then learn to tacitly collude.
        Now, the harm from these three scenarios is the same as if
    the executives were agreeing among themselves in a smoke-filled
    hotel room, namely higher prices and reduced output.
        But this is not just a U.S. problem. I mean, many
    jurisdictions recognize that it's hard to challenge this type
    of collusion under their current antitrust law, and it's not
    just simply an issue in housing markets.
        Two recent studies have found evidence of tacit algorithmic
    collusion in Germany's retail gas station market, as well as on
    bol.com, the largest online shopping marketplace in the
    Netherlands and Belgium.
        So as more companies adopt pricing algorithms, this can be
    at times pro-competitive, but it also can be anticompetitive
    and beyond the reach of the antitrust law.
        So if I can impress upon you one thing today, it's this: AI
    will only compound the legislative deficit to date. These
    problems will not go away. And you need then to then look at
    this holistically from three different approaches.
        First, Congress should endorse the FTC's use of its
    authority under Section 5 of the FTC Act to tackle algorithmic
    collusion. And in addition, consider displacing the unwieldy
    rule of reason standard with clearer legal presumptions
    concerning certain vertical restraints.
        Second, the primary weapon to deal with algorithmic
    collusion is merger review. And the good news is this: that
    Congress has already proposed some of the tools necessary, such
    as restoring the incipiency standard in the merger review.
        And to note, it would be the Competition and Antitrust Law
    Enforcement Reform Act, and then the Prohibiting
    Anticompetitive Mergers Act of 2022.
        Finally, any comprehensive policy response must address not
    only algorithmic collusion, but also the other myriad risks
    involving AI. And this includes concerns over behavioral
    discrimination.
        So we need privacy legislation, where individuals without
    penalty can opt out of the collection of their data for
    behavioral advertising.
        They can opt out of having their data collected about them
    in order to profile them.
        They can opt out of personalized services.
        And then they can also decide the right to limit at the
    onset what personal data is collected about them and--for what
    non-advertising purpose.
        And this is just necessary. I mean, we see that in Europe,
    they already have the DMA. They're taking these additional
    steps. We need to do something as well to address the risks of
    AI.
        Look forward to your questions. Thank you.
        [The prepared statement of Professor Stucke appears as a
    submission for the record.]
        Chair Klobuchar. Thank you. Music to my ears, Professor
    Stucke. And thank you for, kind of, looking at this in that
    larger context of some of the need for reform of our antitrust
    laws.
        So thank you, all of you. I'm going to give my first
    slotted time to Senator Hirono, who's been patiently waiting,
    and then we'll turn to Senator Lee.
        Senator Hirono. Thank you, Madam Chair, and Ranking Member
    for having this hearing.
        There's no question that the cost of housing is an issue
    throughout our country, and I am very well aware of how
    critical that is in Hawaii.
        In July, Hawaii Governor Josh Green issued an emergency
    proclamation on Hawaii's housing crisis. Not a simple thing, by
    the way.
        The average single-family house in Oahu now costs over $1
    million and less than one third of households can afford to buy
    a home. Another third cannot afford rent, in part, because of
    these figures. Hawaii loses another resident every 36 minutes.
    Let that sink in.
        As of 2022, there were more native Hawaiians living on the
    mainland than in Hawaii. All of that predates the fire that
    devastated Lahaina and destroyed 3,000 homes and apartments,
    many of which house working class families.
        Why do I bring up these facts? Well, junk fees, invest your
    own homes, and supply chain shortages aren't entirely
    responsible for this crisis. But in such a tight market, they
    have an outsize effect.
        For Professor Stucke, this is the Antitrust Subcommittee.
    So I'm--I'm interested to know what can we do with our
    antitrust laws?
        I believe you mentioned some changes we could make to the
    FTC's ability to go after algorithmic collusion, but perhaps
    some Sherman Act changes could also be helpful. Can you just
    talk a little bit more about some of the kinds of antitrust
    changes that you mentioned?
        Professor Stucke. Sure. Certainly. I outlined them at the
    end, and one thing is, is that, you know, the concern about
    junk fees, you have to ask yourself, ``Why isn't competition
    addressing this?''
        In fact, why are firms increasingly competing to find
    better ways to manipulate consumers?
        Senator Hirono. Uh-huh.
        Professor Stucke. And this might happen in markets that
    aren't monopolistic or aren't having just a few competitors.
        So one area for competition authorities, is to understand
    when competition isn't working, what are the assumptions
    underlying competition, and what is happening that is
    preventing competition from being a race to the top rather than
    a race to the bottom.
        So this happens not only with junk fees, it's also with
    drip pricing and the like. And the FTC can go after that as an
    unfair method of competition. They can provide the necessary
    guardrails.
        The other area is with respect to pricing algorithms. I
    mean, your principle weapon is going to be mergers to prevent
    markets from becoming highly concentrated that this algorithm
    can occur.
        But the problem is, is that courts have drifted away----
        Senator Hirono. Mm-hmm.
        Professor Stucke [continuing]. And view themselves
    basically as fortune tellers that have to predict what will
    happen after the merger and expect the agencies to prove higher
    prices post-merger. And as an enforcer of yourself for
    antitrust laws, you know how difficult that could be.
        Senator Hirono. So basically, I mean, while we can, I
    think, possibly clarify and strengthen some of the antitrust
    provisions, it seems to me the bottom line in our housing
    situation is demand.
        There is so much more demand than there is availability of
    affordable for purchase and rentals.
        And this is something that Ms. Yentel--you and I co-wrote
    an op-ed back in 2019 about the affordable housing crisis and
    my Pathway bill.
        How would combating--getting back to junk fees and other
    predatory fees--be part of a comprehensive solution to our
    country's housing crisis?
        Ms. Yentel. Well, as you and I have talked about in the
    past and raised awareness around, when you're looking at the
    lowest income people who have maybe a combined household
    earnings of $25,000, or a senior, or a person with a disability
    who's on an extremely limited fixed income of $15,000, they're
    already living doubled----
        Senator Hirono. Mm-hmm.
        Ms. Yentel [continuing]. Or tripled up. They're already
    paying 50, 60, 70 percent of their very limited income just to
    keep a roof over their heads----
        Senator Hirono. So what can we do?
        Ms. Yentel [continuing]. Any additional expense----
        Senator Hirono [continuing]. We're running out of time. We
    know what the--there are so many challenges, but what can we do
    from the congressional level to--one thing, we could fund some
    of the housing support----
        Ms. Yentel. Absolutely. We have to----
        Senator Hirono [continuing]. Programs.
        Ms. Yentel [continuing]. We have to build more housing
    that's affordable to the lowest income people.
        We have to make existing housing affordable to the people
    living in it with rental assistance.
        We need robust and enforced tenant protections.
        And when it comes to extra fees that landlords are paying,
    we need full transparency. And they need to be minimized, the
    number of fees that landlords can charge tenants, because every
    dollar adds up, and that's another bill----
        Senator Hirono. Yes.
        Ms. Yentel [continuing]. That a tenant must pay.
        Senator Hirono. I think there's a bill that puts the price
    at $25 more in these kinds of fees. There's a lot we can do.
    Thank you very much for all of your testimony.
        Ms. Yentel. Thank you.
        Senator Hirono. Thank you, Madam Chair.
        Chair Klobuchar. Thank you, Senator Hirono. Senator Lee.
        Senator Lee. Thanks so much, Madam Chair.
        Ms. Calder, I'd like to start with you, if that's all
    right. In your experience, where have you seen the most acute
    impact of significant Federal land ownership in housing prices?
    Where in the United States does that show up?
        Ms. Calder. Well, your staff at the Joint Economic
    Committee actually put together a great report on this and
    went, sort of, State by State.
        And I think a couple of the States that stood out to me:
    California actually has a huge housing shortage, there are
    certainly Utah, Nevada--of course, Nevada is mostly Federal
    land. And there are some others that are listed there, as well.
    And you, sort of, go State by State on those.
        I think, you know, broadly speaking, the Federal lands
    issue is something that affects all Western States. So it's not
    a single State that is impacted to a much greater degree than
    the others. But all of them would benefit substantially from
    Federal lands reform.
        Senator Lee. Right, right. And it's an interesting thing to
    study because if--in any State there--first of all, there is no
    comparable landowner to the United States in America--nowhere.
        Nobody could afford to own that much land. But even if
    there were, they couldn't exempt themselves from all economic
    forces including property taxation. And it certainly wouldn't
    exceed a few percentage points.
        But from a competition policy standpoint, there would be
    concern if any one individual, a corporation, nonprofit, NGO,
    whatever, owned more than, I don't know, 5 or 10 percent of the
    land in a State, it'd be pretty concerning.
        And so it's not surprising that in a State like Utah, where
    67 percent of the land--two thirds of it is owned by one
    owner--that owner exempts itself from property taxation and all
    economic forces, it's going to have a significant constraint on
    the availability of housing supply.
        Especially in a rugged State where a lot of our land is
    mountainous, and you've got a limited number of places where
    people could live to begin with. But it's drastically more
    limited when most of the land that could be inhabited by
    humans, is owned by the Federal Government.
        What do you think can be done to alleviate some of the
    problems created by this significant land ownership? It doesn't
    have to necessarily result in a housing shortage. Does it?
        Ms. Calder. Well, I think certainly, you know, zoning
    reform is part of the answer. Right? So you can get more units
    by reforming zoning at the local level.
        You can build--you can build two directions: You can build
    up and you can build out. And so I think both pieces are part
    of the equation when it comes to making improvements to housing
    affordability.
        And I certainly think that the Houses reforms, or something
    likened to it, is part of the equation when it comes to
    improving housing supply in Western States.
        Senator Lee. Right. You mentioned in your testimony that it
    would require just 0.1 percent of Federal land holdings in
    order to substantially increase the availability of housing in
    Western States, even eliminating altogether what are known as
    the housing availability shortages in some States.
        Is it your impression that this 0.1 percent change in
    Federal land holdings would--what would that do to the overall
    experience of Federal lands?
        I mean, does that cause a meaningful change for these land
    management agencies and those who enjoy accessing those lands
    to affect 0.1 percent of the Federal land holdings in those
    States?
        Ms. Calder. Yes, I think we need to think about what type
    of land, again, this is. And as I mentioned in my testimony,
    it's--with the Houses Act anyways, it would be BLM land that's
    really impacted by this, that would be, you know, that would be
    nominated, and then purchased, and then developed into housing.
        So BLM land, for those that aren't familiar, historically,
    it was land that homesteaders had passed over. It was land that
    other agencies, other Federal agencies didn't want to manage.
        Oftentimes when we're thinking of sort of the desert or
    Intermountain West, what this ends up looking like is sagebrush
    and desert land. And so it's not the scenic vistas, it's not
    National Parks, it's not Bureau of Indian Affairs Land.
        So from that perspective, I don't think the public would
    probably notice very much. What I think the public would notice
    is the funding that is being transferred into improvements to
    National Parks and other types of infrastructure that they're
    going to benefit directly from. And that's something that the
    Houses Act allows for.
        Senator Lee. And significant benefits that go along with
    cost of living improvements along with that.
        Mr. Antoni, what role has Government spending and
    irresponsible monetary policy at the Federal level played in
    the more than doubling of the cost of home ownership just in
    the last 2 years?
        Mr. Antoni. Thank you, Senator for the question. It has
    been the main driver. And without that cause, we would not have
    had the effect that we currently have today, where home
    ownership is just grossly unaffordable for the vast majority of
    Americans.
        When the Federal Reserve set out to create the trillions of
    dollars that the Treasury Department needed to spend over the
    last several years, it created inflation which caused the price
    of everything to rise, especially homes.
        But its low interest rate policy, essentially a zero
    percent interest rate, compounded that because it made the
    monthly payment on a mortgage incredibly low.
        And so you could afford a much larger mortgage for the
    exact same payment relative to let's say a normal interest
    rate, or the interest rates that we had at the end of 2019, or
    even the first 2 months of 2020.
        And so if you take away that, that root cause, you
    essentially remove the first link in the chain that we have
    had--that we are--have been dealing with and are still dealing
    with today, in terms of the unaffordability of home ownership,
    which has also compounded the problems in renting.
        Because the shift of demand--as people move away from
    trying to buy a home to rent a home, because home ownership is
    simply too unaffordable--they are now increasing the demand for
    rents, which is driving up the price of rental units.
        And so it is not simply a problem contained to home
    ownership, but it is housing in general.
        Senator Lee. And the distribution of the victims that are
    harmed by this is not exactly even across the economic
    spectrum. I mean, it is disproportionately affecting the middle
    class and low-income earners. Right?
        Mr. Antoni. Certainly, Senator. And this is true for
    inflation generally, but specifically for housing those who
    have the least are hurt the most by it, an extension of the
    Matthew Principle, I suppose you could say.
        And so what we are seeing today is essentially an entire
    generation of Americans who, for the first time in recent
    history, may never be able to own their own home. Because as
    they continue saving, the savings that they have are losing
    value every day in the bank from inflation while the price of
    homes go up.
        And so they need an ever-growing down payment in order to
    buy a home. And the down payment needs to be especially large,
    so that they can afford the monthly payment at such high
    interest rates.
        And the problem is, that, that in that rat race,
    essentially, they will never actually get to the point where
    they have enough money for that down payment.
        Because as you were saying earlier, they are constantly
    seeing their earnings decrease in terms of what they can buy.
    And so there is less left over at the end of every month after
    they have paid for all of their necessities, including their
    ever-increasing rents to be able to save for that down payment.
        Senator Lee. Rich people made out pretty well in this. Rich
    people who wanted to buy up a lot of stuff, they made out
    really well--and just did so at the expense of the poor and
    middle class.
        And all of this, if I'm understanding you correctly, has to
    do with the manipulation of the interest rates by the Fed and,
    in part, in, to a significant degree anyway, to help facilitate
    the financing of reckless Federal spending by Congress.
        In other words, Congress doesn't want to exercise the
    discipline to spend no more than it takes in or anything close
    to it. It wants the praise of spending more money without
    having to do the hard work.
        And in order to finance all of that there's pressure on the
    Federal Reserve to keep rates low. That makes it easier for
    Congress to avoid doing the difficult work, and it perversely
    helps rich people while hurting poor middle-class Americans. Is
    that a fair assessment?
        Mr. Antoni. I think so, Senator. Especially when you
    consider that those who were already homeowners or those who in
    the initial stages of the pandemic, for example, were able to
    take advantage of these historically low mortgage rates, they
    were able to acquire that capital at relatively low prices
    before the inflation set in, in the months and years that
    followed.
        And so they were able, again, to acquire capital at a
    relatively low cost, and then to see the price of that capital
    appreciate noticeably in the months and years that followed.
        Senator Lee. Thank you.
        Chair Klobuchar. Thank you, very much, Senator Lee.
        I'll start with you, Ms. Yentel. Can you talk about the
    type of junk fees that renters are faced with? I don't think
    people are always--who don't rent anymore, maybe rented at some
    point--are not familiar with what's going on.
        Ms. Yentel. There can be a whole--thank you, Senator
    Klobuchar. There can be a whole host of fees added on to a
    renter's rent payment each month, ranging from first rental
    application fees to get into the apartment in the first place,
    and then, fees related to late payments, notices of late
    payments can have an extra fee. There's pet fees. There's fees
    for using a garage or fees for an internet usage that's
    mandatory and somebody can't opt out of.
        There's been stories of these fees adding up to as much as
    $400 a month in addition to the rental payment. And sometimes
    they can be very egregious.
        We have a partner in Idaho who worked with a tenant whose
    son brought home from school one day a praying mantis in a jar,
    and that month they were charged a pet fee from the landlord.
        The good news was that that spurred a successful campaign
    for the State of Idaho, now, to have a law that requires full
    transparency up front about any fees that might be paid and
    requires that they be made reasonable. But they really can be
    egregious, and they certainly add up.
        Chair Klobuchar. Wow. Just remembering back, my mom was a
    second grade teacher and sometimes these types of animals would
    get lost when they went home.
        [Laughter.]
        Ms. Yentel. Yes.
        Chair Klobuchar. They were usually found, like the rabbits
    and things. But anyway, that's incredible. But I do think it
    gives us a sense of that, and those of us who rent when we're
    here actually know some of this, as well.
        Professor Stucke, just to go through this again, because I
    think it's a hard thing to get a grasp on. There have been
    numerous reports and lawsuits highlighting these price-setting
    tools that collect the pricing data--and as you widely point
    out, there's no Federal privacy law in place, which is a
    problem--to coordinate price increases among competing
    landlords. So they're able to get this data.
        And could you explain how these pricing tools could
    facilitate these higher prices? So they get the data, and then
    it's shared, and how can that lead to these higher prices where
    you could see it as a not a traditional way of fixing prices,
    maybe, but a way of doing it in the modern digital age?
        Professor Stucke. Okay. So, I mean, there are several
    scenarios.
        One scenario is where every firm has their own pricing
    algorithm. So when you go to like Martha's Vineyard, one thing
    you're surprised by is the high price of gas.
        But what one study found is that when gasoline stations
    start having these pricing algorithms, the speed in the
    response can prevent any company from getting an advantage by
    discounting.
        So what happens then, in these markets, is that prices
    start then elevating up. So algorithms can help facilitate
    collusion in markets already susceptible to it, but it can also
    increase it.
        Another scenario, and this happened in Las Vegas, is where
    allegedly 90 percent of the hotels are all using one hub. And
    so no competitor is going to give commercially sensitive
    information to the hub if the hub can then use it to help the
    rivals.
        So there must be some understanding that they're going to
    share, on a real-time basis, commercially sensitive information
    with the hub so that it's going to benefit all of them.
        Chair Klobuchar. Okay. So you rightfully noted these--some
    of the bills, some of them are my bills, that you could do
    generically to fix the antitrust laws--tweaks, things you could
    do.
        Because it's very hard to bring any cases, including in
    tech and other things right now, where we've had no specific
    laws really passed except for Senator Lee's, which I'm the
    proud Co-Sponsor bill on not changing venues, and then our bill
    to change the merger fees that Grassley and I had to, to get
    more money to the agencies.
        Could you talk specifically what you could do about this
    specifically to update our competition laws so that these tools
    as they are called, or price-setting tools as they can be used
    for, cannot be used to raise rent above what would occur in a
    competitive marketplace?
        Professor Stucke. Right. I mean, I think there are several
    things that can be done.
        Number one is to restore the incipiency standard and
    antitrust that courts are adrift. They used to interpret the
    antitrust laws with the aim that Congress had intended. Right?
    Celler-Kefauver in 1950 enacted these amendments to the
    antitrust laws and the Supreme Court construed the law as
    Congress intended.
        That's no longer the case. So one way would be to restore
    the incipiency standard, which your bill does.
        The second thing, then, would be a different standard than
    the rule of reason for information exchanges, just because the
    rule of reason is just amorphous and unwieldy.
        And then the third thing--and I think this is what like
    John Stuart Mill said about one of the good things that the
    Government can do--is collect a lot of information and then
    disseminate it.
        So one nice thing about your bill is improving the
    knowledge that we have about what antitrust policies work and
    not work. I mean, when I was at the DOJ, it was always
    surprising that we would allow these mergers to happen and then
    we never followed up to see----
        Chair Klobuchar. Years later.
        Professor Stucke. Yes. To see if it was right. And so----
        Chair Klobuchar. Ticketmaster, Live Nation. Anyway--and I'm
    sorry. My mind just went to something else.
        [Laughter.]
        Chair Klobuchar. Keep going.
        Professor Stucke. But I would think that's one of the most
    important aspects that we can have. And then we could learn
    more about what markets are susceptible to tacit collusion.
        Is there a specific threshold? Like one study found, once
    it went beyond 8 sellers, the use of pricing algorithms became
    quite vigorous.
        And so we just need to have a better understanding and the
    United States can play an important role in that.
        Chair Klobuchar. One of the most pressing issues is not
    enough affordable homes. We just talked about that, single-
    family starter homes.
        So like, Dr. Quintero, could you explain how having fewer
    home builders in a market reduces the supply of new homes?
        Professor Quintero. Thanks for the question, Chair
    Klobuchar. The underlying concern about competition, in
    general, is how fewer suppliers of any good or service are just
    going to supply less of it.
        And as a consequence, with a fixed demand, or in this case
    for housing with a growing demand, prices would go up. This is
    what has been happening in housing. We have fewer and fewer
    developers building and it's in their own interest to charge
    higher prices.
        And that is not a new story. That's an old story. That's a
    story of housing markets. The problem is that as prices have
    gone up since 2011, we have not seen an entry of new developers
    that compete with those that are incumbent.
        And so what we find is that those that have an interest in
    supplying less to charge higher prices, are not being
    threatened by competitors in many----
        Chair Klobuchar. Uh-huh.
        Professor Quintero [continuing]. Of the local markets.
        Chair Klobuchar. And so do you think that's something
    antitrust enforcers should look at in the future when mergers
    are presented to them?
        Professor Quintero. Yes. There's been at least 12 mergers
    that, if you look at the housing markets well-defined
    spatially, should have been challenged by any regulatory
    agency. They would've been challenged in other sectors.
        My belief and my understanding is that what they're doing
    is, they're defining, in some cases, whole regions of the
    United States--in one case that I could find, the whole U.S. as
    a single housing market. I think that is wrong. We as
    potential----
        Chair Klobuchar. They should like talk to the people in
    Jackson County, Minnesota.
        Professor Quintero. Right. As potential homeowners, we're
    not substituting between the possibility of living in DC and
    living in LA. Right? So----
        Chair Klobuchar. Yes----
        Professor Quintero [continuing]. So, yes.
        Chair Klobuchar. So, that was that last comment. Then I'll
    turn it over to Senator Hirono--or Senator Lee for additional
    questions, then Senator Hirono for a second round.
        But one of the things that have been troubling to me is in
    some of our rural areas, where we have very steady employers,
    we really do.
        And whether it's the ag economy or whether it's a
    manufacturing--we have a lot of major companies--there's still
    issues with this housing and there's just not enough builders
    and the land is not as expensive.
        We don't have the land issue that Senator Lee was referring
    to in our State. And I just--I can't help but think that in the
    old days, there were just more smaller people that were coming
    in in the home building industry. Because we just can't get--
    I've called, built, I've done everything. And we've looked at
    what incentives can we have to bid them. These are usually
    maybe--they're a mix of housing. Right?
        They're starter homes. Some of them are traditionally
    affordable. Some of that next step up. And it's really hard,
    and it's hurting our rural employers because it's like chicken
    and egg. They want to expand, these are like manufacturing, but
    they can't really expand because they don't have the housing.
        And some of it is getting seniors to move into town, but
    then you need the condos. If they build them, they'll come. And
    then that frees up the single family. So, thank you. Senator
    Lee.
        Senator Lee. Thank you. My next question is going to be
    both for Ms. Calder and Mr. Antoni. In your testimony, you both
    mentioned one way or another that the impact of government
    regulation, whether it be State, Federal, or local on housing
    prices. What--what government regulations do you think
    specifically cause the greatest increase in home prices? We'll
    start with you, Ms. Calder.
        Ms. Calder. Well, I think there's a broad body of research
    on, again, State, and local zoning regulations. Really that's
    coming from a local level. And among those regulations, I think
    they all sort of add on, augment each other in ways where you
    can't--it's not totally easy to pull any one out and say, if
    you just fix this one thing, then you would fix housing
    affordability and housing supply.
        Because if you fix the one regulation, then the other
    regulations are all manipulatable, and they can also be made
    more restrictive in ways that won't allow for housing to be
    developed.
        That said, I think density regulations are really
    problematic. So where you sort of zone the whole city as
    single-family homes, that's going to be an issue because, of
    course, it limits housing.
        And I think, aside from that, you know, minimum lot sizes
    that are very large, those are going to be issues, as well,
    and, you know, just permitting processes that are very lengthy,
    and very uncertain, and very open-ended.
        That doesn't give developers a lot of confidence as they're
    going through these processes and trying to make plans.
        Senator Lee. So it's the amalgamation of all of them, the
    combined effect of all of them, particularly some of those that
    you mentioned, like minimum lot sizes and things like that, end
    up creating an environment in which relatively few people can
    navigate this byzantine labyrinth of regulations to be able to
    get it done.
        That, in turn, probably leads to more consolidation, which
    might help explain at least some of the answers what Senator
    Klobuchar was talking about, by the fact that there aren't as
    many sort of smaller builders in many communities as there once
    were--because there's such an advantage that goes to a larger
    producer who has the experience and the extra resources to be
    able to devote to complying with those things.
        Mr. Antoni, do you have anything you want to add to that
    one?
        Mr. Antoni. Senator, I think another key thing that's
    important not to overlook here are regulations dealing with the
    financial sector. And the reason that is--that has such an
    impact in the context of housing is because almost everyone who
    buys a house does so through financing.
        And so when we have regulations that force lenders to look
    at things essentially other than risk, what you are doing is
    you are divorcing the individual, the borrower, from their
    ability to repay a loan.
        And so from the lender's perspective, that builds losses
    into their business model. And as a consequence of that, they
    need to spread out those losses among all borrowers.
        In other words, it increases the cost of capital, it
    increases the cost of lending. And that trickles down into more
    expensive mortgages for everyone.
        One other thing that I think might be getting missed here,
    because so much of what we're focusing on, and rightly so, is
    the price of the home.
        But also, what about what is in the home? Things like
    appliances. We have all kinds of regulations, for example, that
    are aimed at increasing the efficiency of what--it could be
    your refrigerator, it could be your dishwasher, your clothes
    washer, dryer, etc.
        And so many of these regulations that do increase appliance
    efficiency are actually a net loss for the consumer because of
    the increased cost.
        And when we're talking about these regulation-imposed cost
    increases, they tend to be completely missed because of hedonic
    adjustments in things, like the CPI. So they're typically not
    included in inflation metrics.
        And, actually, a colleague of mine, Casey Mulligan, who's a
    professor at the University of Chicago, he has pointed out that
    the cost of regulations today are, on the average American
    family, are literally thousands of dollars more per year than
    they were just 4 years ago.
        Senator Lee. Yes. That sort of thing adds up. Plus, a lot
    of the appliances just don't do as good of a job. But that's
    a--that's a conversation for a--for a different day. But you're
    exactly right. Those add up.
        And unlike our tax bill, where we can see at the end of the
    year how much we're paying, you can't see the regulatory
    compliance costs. There's no comprehensive bill for it.
        We have in our minds this idea that those are all paid for
    by corporations. And in a sense they are, but not really,
    because they get passed down to hardworking Americans who pay
    higher prices for goods and services, everything they buy.
        And they also pay for it in meaningful ways through
    diminished wages, unemployment, and underemployment.
        What have you observed in your market analysis throughout
    the country? Are there factors that apply uniquely to
    metropolitan areas, more heavily populated areas? What do you
    see there in terms of home affordability, specifically in major
    metropolitan urban environments?
        Mr. Antoni. Well, what we find, Senator, typically, is in
    those major metropolitan areas, a higher level of regulation.
    And we also find higher taxes, you know, on average. And so we
    have higher costs of home ownership in those areas.
        On page 4 of my testimony, for example, you look at the
    most expensive areas in the country, almost all of them are in
    California, in terms of owning a home.
        In fact, in several of those areas, the median--the median
    income, it actually requires more than a hundred percent of the
    median after-tax income to buy the median-priced home in those
    areas.
        In other words, it's literally impossible for the typical
    American family to buy a home in those places.
        Conversely, as you start getting into typically more
    suburban or rural areas, and you typically see taxes and
    regulation go down, home ownership, affordability, on average,
    does tend to rise.
        Senator Lee. And that, in turn, ends up creating even more
    disparities as you look across the economic spectrum. Because
    if you're in one of those areas, you're unfortunate enough to
    live in there, some of the--setting aside the graduated income
    tax system that we have--some of the benefits associated with
    home ownership, like the mortgage interest deduction either
    phases out or ends at, I think, around $500,000, or something
    like that.
        So if you happen to be in one of those areas, even if
    you've got the cheapest home in your community, you might be
    priced out of it in multiple ways--and making it even harder
    for people who are just below the economic threshold of people
    who could otherwise purchase in that area, you may never get
    there. Thank you, Madam Chair.
        Chair Klobuchar. Okay. Thank you. Senator Hirono.
        Senator Hirono. Thank you. I just have a few follow-up
    questions and one new question.
        Professor Quintero, while there's a severe shortage of
    affordable housing in our cities, and it--the new work from
    home dynamic means that there is often a glut of office space
    available. So some cities and developers are working together
    to convert underutilized office space to residential.
        For example, in Honolulu, you can now live in the office
    building that houses the Federal bankruptcy court. Could
    relaxing or altering building codes and incentives to encourage
    office to residential conversions to be part of the solution to
    our affordable housing crisis?
        Professor Quintero. Anything that increases the effective
    supply of homes, whether it be new homes or existing, would
    help toward a solution.
        The case I'm, I'm most familiar with is Baltimore, where
    there's been a significant move toward conversions from----
        Senator Hirono. Mm-hmm.
        Professor Quintero [continuing]. Commercial to residential.
        There's a significant barrier in terms, one structural, the
    other one in legal terms and zoning regulations that prevent
    these conversions from being done cheaply and quickly. And so I
    think there's a long way to go for conversions to actually
    solve the problem, but they would be a step in the right
    direction.
        Senator Hirono. Well, to the extent that all these States
    and counties also have the zoning regulations, there may be a
    way for us to approach the--supporting these kinds of
    conversions with health and safety in mind, of course, on a
    national level. So if you have some ideas along those lines,
    please pass them on.
        For Professor Stucke, in the multi-district litigation that
    has been filed against RealPage, one of the allegations was
    from someone who has utilized RealPage, he said that,
    ``Although we''--meaning him--``we are,'' they're, ``all
    technically competitors, RealPage helps us to work together to
    make us all more successful in our pricing.''
        And so, short of an agreement, that is definitely price
    fixing.
        And so, based on the Supreme Court's current posture on
    price fixing, tacit collusion, or conscious parallelism, these
    are not price fixing. So is this--now that we have these new
    tools or new entities, such as a RealPage with algorithms, this
    is not Bob giving you information.
        This is a whole system. Don't you think that we need to
    have some changes, as I mentioned, to our antitrust laws, to--
    to address the new tools that are being utilized that basically
    results in fixed prices?
        Professor Stucke. Absolutely. So antitrust needs to be
    modernized for the digital economy. The last time you've had
    meaningful antitrust regulation was--update to legislation was
    over like, you know, what is it, 50 years ago?
        Senator Hirono. Mm-hmm.
        Professor Stucke. And so you--but tacit collusion is very
    tricky to get at by itself, because it can just be the response
    of market participants.
        Like you can have tacit collusion in markets where like I--
    one way to explain to my students tacit collusion is, I say,
    ``Break up into groups of two or three. Here's the monopoly
    price, here's the competitive price. Just show each other the
    price that you're going to charge for that day.''
        And then after 10, 15 rounds, they report their results.
    Invariably it's close to the monopoly rate.
        And so how as an enforcer, can you get at that? Right? You
    can't tell a competitor not to look at its rival's rates. So
    getting at this collusion directly head on is very difficult.
        So the best way to do it is to get at it indirectly. That
    would be through merger review, and then any sort of
    facilitating practices that can help achieve that algorithmic
    collusion. For example, sharing of confidential information
    with the hub.
        Senator Hirono. I think we need to do something because
    there's just a lot of these new kind of tools, AI, all of these
    new tools that did not exist 50 years ago when the basic
    antitrust laws were first being articulated. And I do think
    that we need to, as you say, modernize and if you have some
    language that you can propose to the Committee, I would
    certainly be interested.
        But the fact that you have all these investor purchases now
    of housing stock, a huge percentage--it could be a huge
    percentage in certain areas like Atlanta, they seem to go to
    certain areas. I think that just increases the chances of these
    kinds of collusive--what I would call collusive parallel
    pricing.
        I think we need to do--I'm asking you for some ideas on how
    we can go forward. Thank you, Madam Chair.
        Chair Klobuchar. Thank you very much, Senator Hirono, for
    those good questions. And next up we have Senator Blackburn,
    then I have a very brief question, and then I think we're going
    to end things, as there's a conflict with an AI meeting.
        But we are very focused on this issue right now. Senator
    Blackburn.
        Senator Blackburn. Thank you so much. And yes, you're
    right. It's a busy day. There is a lot happening.
        Professor Stucke, welcome. We are delighted that you are
    here from UT, and appreciate that you would make the trip. So
    thank you for that.
        Ms. Calder, let me come to you. You know, in Tennessee, we
    have a lot of people that are moving there and they're wanting
    to leave other areas. We even have some Minnesotans that have
    come to Tennessee to relocate.
        Chair Klobuchar. Especially in the winter.
        Senator Blackburn. That's exactly right. They like our
    weather a whole lot better. But we know that there's a need to
    focus on some commonsense solutions. And some of us have really
    done that.
        What we have found is, over 10 million families spend more
    than half of their income on housing. And, of course, this
    makes it very difficult for the rest of their budget.
        So some of us at Finance Committee have brought forward a
    bill the Affordable Housing Credit Improvement Act, which would
    expand and strengthen the low income housing tax credit, and
    that bill would increase the number of credits available to
    States by 50 percent.
        And it would improve that program so that it's better
    serving veterans, individuals in rural areas like we have in
    Tennessee, and victims of domestic violence.
        So I'd like for you to talk a minute about why it is so
    important to modernize that low income tax credit.
        Ms. Calder. Well, thank you for the question. I appreciate
    it. I certainly have--I have written critically of the low
    income housing tax credit in the past. And so I'm not familiar
    with all the details of this particular bill.
        But I do think that the low income housing tax credit
    certainly needs modernizing, changing. Some of the--some of the
    issues that I see with the low income housing tax credit, in
    general, right now, are that for one thing, it is more
    expensive than various demand side vouchers or demand side
    assistance.
        Most of the benefits, also at the present time, they flow
    to developers, is what research suggests, rather than flowing
    to low-income tenants--which is something that worries me
    because, of course, you know, we have limited resources and we
    need to allocate those resources accordingly to low-income
    tenants wherever possible and extremely low-income tenants
    first and foremost.
        And I've also seen that, because it's a production side
    subsidy, research finds the program contributes to greater
    concentrations of poverty and racial minorities. And that's
    kind of something that's similar among production side housing
    subsidies. So again, not familiar with all the details, but
    certainly like the idea of improving the low income housing tax
    credit.
        Senator Blackburn. Okay. Thanks.
        Ms. Yentel. Senator Blackburn, can I add on to that?
        Senator Blackburn. Yes, you may.
        Ms. Yentel. We support your legislation and appreciate your
    leadership in pushing it forward. The affordable--the low
    income housing tax credit program is an important tool to
    develop affordable housing across the country, and can be
    further improved as your legislation would do.
        And we especially appreciate the provisions in the
    legislation that would allow for developers to ensure that
    these low income housing tax credit properties are more
    affordable to the people who need it the most----
        Senator Blackburn. Got it.
        Ms. Yentel [continuing]. The lowest income people----
        Senator Blackburn. Let me----
        Ms. Yentel [continuing]. People in rural and Tribal
    communities----
        Senator Blackburn. Yes.
        Ms. Yentel [continuing]. And we appreciate the additional
    transparency around LIHTC data.
        Senator Blackburn. Let me stay with you. We hear a lot
    about Bidenomics and the inflation rate that is out there. And
    the fact that the home price--the average home price, median
    home price is up over 27 percent, mortgage rates have increased
    twofold since 2020, and home ownership is a part of the
    American dream. So many people want to own their own home.
        And this administration seems to have some misguided
    policies that are making that more difficult. So as you all are
    doing your work, Ms. Yentel, do you see Bidenomics, the
    inflation rate, all of that having a negative impact?
        Ms. Yentel. No, I'd say the opposite actually. The low-
    income renters certainly are struggling to afford their rent
    now, in some cases, more than ever. And housing affordability
    for the lowest income renters has worsened recently. But it has
    been a long-standing systemic----
        Senator Blackburn. Yes.
        Ms. Yentel [continuing]. Issue in our housing markets.
        Senator Blackburn. Well, my time's running out, but I would
    say Gallup disagrees with you. They found 21 percent of
    Americans believe it's a good time to purchase a home, and that
    number is way down from what it has been. That's the lowest
    that has ever been recorded, and inflation is having a negative
    impact.
        I've got two more questions for Ms. Yentel, but I know time
    has run out and I will yield my time.
        Chair Klobuchar. Okay. And you could put those on the
    record. Is that all right? Okay, thank you.
        One last question. Ms. Yentel, another factor many
    discussed today that disrupts healthy competition in the
    housing market, is the prevalence of private equity-backed
    institutional investors buying up large swaths of single-family
    homes--in some neighborhoods these types of investors own an
    incredibly high percentage of homes.
        I've seen this, like there's been major, major news reports
    on this, well documented. Can you talk about how institutional
    investors came to own a significant share of single-family
    homes in certain markets and how it affects housing
    affordability?
        Ms. Yentel. Well, especially on the second point, I would
    focus on the data that shows that institutional investors tend
    to be among the worst landlords. So there's clear evidence that
    institutional investors are more likely to be serial eviction
    filers, to evict--to file evictions more often, to add
    predatory fees, to use serial evictions and predatory fees as a
    profit-generating scheme.
        So as those institutional investors especially are
    targeting communities that are disproportionately people of
    color or have disproportionately high rates of poverty, then
    we're seeing the harm of these practices fall even greater on
    people with the lowest incomes and the most marginalized
    households.
        Chair Klobuchar. Mm-hmm. All right. Well, thank you very
    much.
        Senator Lee. Can I ask one very brief follow-up?
        Chair Klobuchar. Yes.
        Senator Lee. I just want to give E.J. a chance to respond
    to Senator Blackburn's question about Bidenomics and what
    impact it's had on housing affordability.
        Mr. Antoni. Certainly, Senator. Just very briefly, if you
    look at the performance of wages versus price indexes, such as
    the consumer price index, you find that it--for a record 26
    consecutive months of the Biden administration, the consumer
    price index had larger annual gains than weekly earnings did.
        And so, as a result of that, the typical American family
    has lost thousands of dollars in income, not in terms of the
    size of the paycheck, but what that paycheck can actually buy.
        And then you couple, as you pointed out, this connection
    between spending and inflation and the creation of money, when
    you also include the fact that interest rates have gone up so
    dramatically, that has increased the borrowing costs for
    families by thousands of dollars a year.
        And these effects combined make the typical American family
    about $7,300 poorer today as compared to January of 2021.
        In other words, take what the typical American family was
    earning at the time of the start of this administration and
    compare that to today, and it is as if you took $7,300 off of
    their annual earnings.
        Chair Klobuchar. Anyone want to add anything more here? Are
    we good? Okay. Ms. Yentel.
        Ms. Yentel. Well, just to finish what I was saying with
    Senator Blackburn is that to their credit despite housing
    affordability worsening for the lowest income renters, to their
    credit, the Biden administration and this Congress provided
    historic resources during the pandemic that staved off what
    could have been an eviction tsunami.
        And instead those resources kept eviction filing rates at
    their lowest on record. And those are the kind of investments
    and programs that should be continued and made permanent.
        Chair Klobuchar. Okay. Very good. I want to thank all of
    you. It's been a very informative hearing. There are so many
    issues that are clearly related. When you have housing prices
    go up in part because some of the factors we discussed here
    today, and then people go over and rent, they can't own their
    own home, and then those rents go up. You can kind of see
    what's been going on here.
        And I do think looking at this in a way that doesn't argue
    that the only thing at issue, by any means, is competition
    policy and algorithms, but it is part of it.
        And especially when you look at some of the recent changes
    and you think about, let's look at all the factors going on
    here with consolidation, with algorithms, I think it's actually
    fodder for future work.
        So I want to thank all of you for being here today. I know
    that the record will remain open for the next week for Senators
    to submit any additional questions.
        And with that, I want to thank you, all, for coming and the
    hearing is adjourned.
        [Whereupon, at 4:09 p.m., the hearing was adjourned.]
        [Additional material submitted for the record follows.]

                                A P P E N D I X

    Submitted by Chair Klobuchar:

      National Multifamily Housing Council (NMHC) and the National
        Apartment Association (NAA), letter...........................    80

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