FTC Launches Rulemaking to Ban Rental 'Junk Fees' as Tenants Report Hidden Charges Inflating Rent

The modern apartment hunt often ends with a nasty financial surprise at lease signing: the $1,800 advertised rent suddenly balloons to $2,050. These mandatory add-ons—ranging from "valet trash" and package-sorting fees to non-optional "smart home technology" packages—have become a ubiquitous and deeply unpopular feature of the U.S. rental market.[1]

Now, the federal government is stepping in to overhaul how landlords advertise and collect rent. The Federal Trade Commission (FTC) has officially launched an Advance Notice of Proposed Rulemaking (ANPRM) specifically targeting unfair and deceptive fees in the rental housing industry.

The initiative marks a major escalation in Washington's broader war on "junk fees." While previous regulations targeted concert tickets and short-term lodging, this new effort aims to mandate total-price transparency before a prospective tenant ever pays a non-refundable application fee or signs a binding lease.[1]

The mechanism of the FTC's proposed intervention centers on the concept of "total price disclosure." Under this framework, landlords and property management software platforms would be legally required to include all mandatory monthly charges in their baseline advertised rent.

This means a property manager could no longer advertise a $1,500 apartment while burying a $50 mandatory internet fee, a $30 package locker fee, and a $25 administrative billing fee in the fine print. The advertised price would simply have to be $1,605.

Beyond upfront disclosure, the FTC is also examining the legality of charging inflated costs for services beyond their actual market value, or charging fees for services that primarily benefit the landlord, such as administrative fees for processing routine rent payments or mail sorting.

This targeted rulemaking arrives after a high-stakes game of regulatory catch-up. When the FTC finalized its broader "Junk Fees Rule" in December 2024, it explicitly exempted long-term rental housing, focusing instead on industries with shorter transaction cycles.[1]

However, the agency did not ignore the rental sector. Instead, it pursued massive, headline-grabbing enforcement actions against individual corporate landlords to build its evidentiary case and signal its intentions to the broader real estate market.

In 2024, the FTC secured a landmark $48 million settlement with Invitation Homes, the nation's largest single-family rental operator, over allegations that it unfairly charged tenants millions of dollars in undisclosed junk fees. Invitation Homes did not admit wrongdoing but agreed to overhaul its disclosure practices.[1]

That enforcement action was followed by a $24 million settlement in December 2025 with Greystar, the country's largest multifamily property manager. Regulators resolved claims that the company deceived consumers by hiding mandatory fees from advertised prices and leveraging those misrepresentations during the application process.

These settlements provided the foundation for the current rulemaking, proving to regulators that case-by-case enforcement was insufficient to police a nationwide industry practice. A bipartisan coalition of 26 state attorneys general agrees, recently sending a joint letter to the FTC urging the creation of a strict federal baseline.[2]

The attorneys general argued that fragmented state laws allow multi-state operators to continue "bait-and-switch" tactics. While states like Colorado, Massachusetts, and Nevada have passed their own total-price advertising laws, a federal floor would prevent corporate landlords from exploiting regulatory gaps across state lines.[1][2]

Tenant advocacy groups, such as the Americans for Financial Reform Education Fund (AFREF), argue that junk fees actively exacerbate the housing affordability crisis. They note that unexpected fees push financially stretched renters closer to eviction, as tenants locked into a lease have little choice but to pay the inflated costs or face severe legal and credit consequences.[1]

But the property management industry strongly opposes a blanket federal crackdown, warning that well-intentioned regulations could backfire on the very consumers they aim to protect. Trade groups coordinated thousands of public comments pushing back against the FTC's initial inquiries.[1]

The National Apartment Association and other industry representatives argue that unbundling services allows tenants to pay only for what they use. If all fees are banned or forced into the base rent, they warn, landlords will simply raise the baseline price for everyone, regardless of whether a tenant uses the pool, the package locker, or the parking garage.[1]

Furthermore, industry advocates argue that rental housing is already heavily regulated at the state and local levels. They caution that a sweeping federal rule could be redundant, increase compliance costs, and potentially conflict with existing local ordinances governing landlord-tenant relationships.[1][2]

The uncertainty now lies in the timeline and the final scope of the rule. The FTC's previous junk fee rulemaking took two and a half years from its initial announcement to implementation, suggesting a long road ahead for tenant advocates.[1]

If that timeline holds, renters may not see federal relief until 2028. In the interim, the FTC's aggressive enforcement posture serves as a warning to property managers that deceptive pricing models carry significant legal risk, even before a formal rule is codified.[1]

Until a federal standard is finalized, housing advocates advise renters to demand a complete, itemized list of all recurring and one-time fees in writing before submitting a non-refundable application fee, ensuring the true cost of housing is known before the ink dries on the lease.