Regulations Rising—Landlords Wonder: Why Bother Owning?

By Don DeBat

 There is a sweeping regulatory movement underway, pushed by Mayor Brandon Johnson—an avowed Democratic Socialist—to take private property rights away from landlords, and give excessive protection to renters.

An estimated 54% of Chicago’s residents—some 600,000 people-are apartment renters, according to the City of Chicago, so Mayor Johnson, who is up for reelection next spring against at least a half-dozen opponents, obviously needs votes.

Chicago currently has two so-called “renters protections ordinances” floating around like circus ballons. One being pushed by Mayor Brandon Johnson is the “Protecting Renters Ordinance” (PRO). The other, the “Fair and Accountable Illinois Rental Ordinance” (FAIR) is being promoted by a group of aldermen.

Mayor Johnson’s “Protecting Renters Ordinance” seeks to update the city’s 40-year-old “Residential Landlord Tenant Ordinance” (RLTO), which oversees the legal rights and responsibilities of tenants and landlords.

The Chicago Assn. of Realtors’ standard apartment lease already is so loaded with renter protection it weighs in at a hefty 37 pages with the 2026 addition of four pages to protect tenants from domestic violence and abuse. Currently, Chicago has one of the most anti-landlord ordinances in the nation.

Taxes and spending the real problem

For both big corporate rental-apartment operators and small “Ma and Pa” owners, experts are not mentioning the real problem. The Tyrannosaurus Rex in the room is soaring property taxes caused by exorbitant governmental over spending in Chicago and Cook County. However, the Mayor doesn’t mention that issue.

In 2025, one Old Town 4-flat owner was hit with a 21% property tax hike, and a 59% increase in fire-insurance premiums. Another landlord in North Lincoln Square was slapped with a 30% tax hike. And, a 3-flat owner in Logan Square is reeling from a 32 % tax hike.

Of course, the high-cost of apartment rents is not totally the fault of landlords. In Chicago, rental property owners have to deal with the second highest property taxes in the nation, along with soaring insurance costs.

According to Mayor Johnson’s PRO ordinance, which already is receiving heavy opposition from apartment managers, owners and investors, the following new restrictions would be added to the already weighty RLTO:

• A ban on hidden, or so-called “junk fees,” such as application and processing fees.

• A “Tenant Bill of Rights” and the requirement that landlords disclose if they’re using algorithmic pricing that is popular in the hotel industry.

• The PRO ordinance would establish a “rental registry,” and create a new bureaucratic administrative body that works with renters and landlords to resolve disputes, among other measures.

The city now has no comprehensive record of its more than 500,000 rental units, nor does it keep a record of who owns the properties and whether they are complying with the law.

However, property ownership is a public record available through the Cook County Assessor’s office.

While the PRO ordinance has not yet been officially released, critics say it contains many troubling provisions that could significantly harm the multifamily housing industry.

It would make progress more difficult to provide quality affordable apartments, according to the Neighborhood Building Owner’s Alliance (NBOA), a non-profit landlord group.

Some landlords say the rental registry essentially would be a “hit list” that would create another layer of taxes on top of city and Cook County property taxes, which are the wildfire-wind driving rent increases.

Other landlords say the proposed restrictions are so heinous that they wonder: “Why bother owning and managing apartments in Chicago at all? We probably could make more worry-free profits investing in the stock market.” 

The amount of the annual registry fee would be determined by building size and owner occupancy. Owner-occupied, Ma-and-Pa two-unit to six-unit buildings and nonprofit affordable housing would be exempt from the fee. Larger building owners would be charged anywhere from $20 to a whopping $60 per unit.

Obviously, veteran apartment managers concerned with the bottom line would simply pass on the inflationary registry fees to renters in the form of higher rents.

Experts say higher rents could lead to vacancies in larger buildings, adding to the pressure of paying hefty property taxes, and eventually leading to deferred maintenance.

When all the potential legal and administrative costs are considered, major landlords will be forced to spend tens of thousands of dollars to fight the ordinance. Rental experts say the proposed measure is guaranteed to increase average monthly rents on each unit in Chicago by at least $100.

The annual fees, which the city expects could total around $20 million, would help fund the initiatives laid out in the bill, according to Jung Yoon, the mayor’s chief of policy. The funds would go toward improving inspections and enforcement.

The annual fees would also establish the “Bureau of Rental Housing Services,” designed to be the city’s first coordinated hub for rental housing. The bureau would administer the rental registry, provide emergency rental and eviction help, provide compliance guidance for landlords and enforce tenant protections.

City officials say the renter-protection ordinance—designed to crack down on slumlords and profit-hungry, rent landlords.

The alternative FAIR plan

Meanwhile, the “Fair and Accountable Illinois Rental Ordinance” (FAIR), the counterproposal promoted by Ald. Gilbert Villegas (36th), one of the architects of FAIR, proposed the following less restrictive renter protections:

• FAIR includes protections against ill-intentioned landlords, illegal lockouts, retaliation for rule enforcement, unsafe living conditions and security deposit abuse.

• FAIR would rely on pre-existing state law requiring fee transparency, with added disclosure requirements, but not go as far in limiting and even outlawing various fees.

• FAIR would create a city rental registry, but would make a distinction between large and small landlords.

• FAIR also would create new incentives to encourage building owners to convert non-residential units, such as storefronts, into apartments.

Ald. Brendan Reilly, 42^nd, said the aldermanic measure strikes a balance between promoting growth and adding regulation without “costly mandates.”

Rental apartment management advocate Michael Glasser, president of NBOA, said: “We welcome the opportunity the FAIR Ordinance presents to build toward genuinely healthy neighborhood housing—with the kind of stability tenants can count on—only when housing providers have it too.”

The vast majority of landlords and real estate groups are skeptical of the Mayor Johnson proposed “Protecting Renters Ordinance,” arguing the measures are burdensome and will drive up the cost of housing.

A review of Mayor Johnson’s PRO plan by Marcus & Millichap, a major apartment manager, said the ordinance could “alter investment behavior” by placing pressure on the apartment industry because of “compliance obligations and restrictions.”

For more housing news, visit www.dondebat.biz. Don DeBat is co-author of “Escaping Condo Jail,” the ultimate survival guide for condominium living. Visit www.escapingcondojail.com.