H.B. No. 2904 introduces new regulations regarding rent increases for residential and manufactured home tenancies in Texas. The bill establishes a maximum allowable rent increase of five percent for affordable housing and ten percent for other types of housing, unless the property has undergone major renovations within the preceding 12 months. Landlords who violate these limits will be liable for three times the amount of the unauthorized increase, in addition to the tenant's actual damages. Each rental period that a violation continues is treated as a separate offense. Furthermore, landlords must provide tenants with a written explanation of the economic conditions or renovations that justify the rent increase.

The bill also defines "affordable housing" as housing affordable to households earning 70 percent or less of the area median family income, as determined by the U.S. Department of Housing and Urban Development. The new provisions will apply only to leases entered into or renewed on or after January 1, 2026, ensuring that existing leases are governed by the previous laws. This legislation aims to enhance tenant protections and promote transparency in rental agreements.

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