Austin City Council passed a resolution during its Oct. 24 meeting directing the city manager to draft an ordinance that requires landlords to disclose all additional fees other than rent throughout the leasing application process.
The resolution is expected to return to council in June as an ordinance to ensure it’s implemented before people renew their leases over the summer. District 5 Council Member Ryan Alter said the city will also work with the Housing Department and Austin Apartment Association to require additional fees be posted in advertisements.
“It’s really important … that we look at the entirety of what someone is paying on a monthly basis, and what we are seeing is those monthly charges (are) a bunch of fees,” Alter said. “I think it’s really important that we require those fees to be disclosed upfront so someone knows exactly what they’re getting into.”
Heather Way, a clinical professor in the School of Law and director of UT’s Housing Policy Clinic, said researchers are finding most mandatory recurring fees including trash valet and pest control fees are not disclosed in an apartment’s advertised price.
“It could be hundreds of dollars in application fees and other upfront fees to get into the unit, and then when they go find their sign the lease, if and when the fees are disclosed and transferred in the lease, then it can be just a really big shock because at that point you already put all this money into getting into the unit,” Way said. “It’s very problematic.”
Theater and dance freshman Valeria Blanco said her biggest priority in the leasing process was staying under a budget. While apartment hunting, Blanco had to actively seek out how much additional fees such as utilities cost on top of rent.
“I find that the pressure (to sign early) also influences the fact that they don’t disclose every single thing that you’re going to be paying for,” Blanco said. “The pressure of ‘You need to get this done now,’ makes it so that you don’t dig deeper on ‘Okay, but how much am I actually paying for?’”
Michelle Estrella, an arts and entertainment technologies freshman, navigated the rental application process for the first time this year, and many places she looked at did not list additional fees.
“It feels a little unfair,” Estrella said. “If they’re (saying) ‘Oh, it costs this much from rent, but we’re charging you, like 700 extra dollars for all these other things that we didn’t tell you about.’ It kind of just feels like lying.”
Way said there’s also a competitive aspect of the hidden fees because if a landlord does want to be transparent with tenants about additional fees the apartment will probably look more expensive. However, if an apartment hides its fees it will probably look cheaper and draw more tenants into the property.
“Ultimately, all of these fees, what they’re doing is they’re increasing the cost of housing and making housing even less affordable than it already is in Austin,” Way said. “This is an issue around the country, not unique to Austin.”
