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Intellections Discussion

No Vacancy: The Consequences of Rent Control

Who do you think benefits the most from rent control and why?

Responses

It creates Red Tape to frustrate both Renters and Owners.
It provides a revenue source for government through court fees, violations and fines.
It facilitates a small army of government employees, the way revenue based parking enforcement does.
It helps to create a crony Real Estate Market where some get special treatment and others have to play by the rules. Others do neither.

UAflyer covers it pretty well. It does benefit owners in that it keeps additional supply from being built, thus increasing demand for existing housing, which drives the price up.

It creates a good "visual" that local governments are attempting to address the issue of affordable housing, placating constituents for the short term.

Doesn't it depend on the character of the Owners? Ideally, they'd be choosing to increase rents truly as needed and see the long-term value of honoring good tenants by not jacking their rents indiscriminately. However, if Owners are choosing to make maximizing profits their bottom line, as opposed to only ONE of the factors in decision-making, then rent control becomes necessary to protect people on fixed incomes and single income homes.

Who benefits the most? The local employers. If rent is cheap, the employees live closer, can get to work easier and the employer doesn't have to pay as much. Rent control is nothing more than a subsidy to local businesses...

It acts in the same way as minimum wage, rent control prices consumers out of the market and creates a perversion in prices. A moral hazard that will lead to less people having affordable housing.

First and foremost, politicians benefit. They can claim that they helped the people, while it cost nothing to the taxpayers. Secondly, people who are currently renting may benefit for some time at least. Thirdly, corrupt businessmen can benefit - but bribing politicians and bureaucrats and making sure that either rent control for their buildings is high or that it is eliminated due to "special circumstances".

I am a landlord. In Oakland, California, we have rent control on all the buildings that were built before 1985, not sure about this, but it seems very arbitrary to me. In anycase, to me as a landlord rents cannot be increase on a tenant anymore than the allowed amount which is tied to the CPI, Consumer Price Index. This seems like it helps tenants who stay in a unit from being priced out of their apartment by a landlord wanting to get more from their investments. As the market heats up, which has happened in our local recently, the market may be considerably higher than that particular tenant is paying due to rent control. This is not to the benefit of the landlord, but the tenant. This can be a difficult situation if the landlord can't make repairs due to the low rents because of rent control. So, I don't understand the above comments in my own situation. By the way, if a tenant vacates the unit the rent can then be adjusted to current market rate.

It is helpful to the elderly and disabled. The intent of the program is good and honorable. Abuse of the program can cause issues, but proper management should eliminate abuse.

It is helpful to the elderly and disabled. The intent of the program is good and honorable. Abuse of the program can cause issues, but proper management should eliminate abuse.

Who do you think benefits the most from rent control and why?

Rent control allows those with lower incomes to stay within a community adding long-term stability as a benefit. Since people are not necessarily paid according to the value of their work (Think of musicians, artists, dancers, writers, as well as retail sales folks, day care providers, waiters, waitresses, etc.) rent control allows them to accept lower paying jobs and still have a quality of life where they are not shoved into poverty pockets. In fact, if rent control were a percentage of every building, we could eliminate projects and end segregation according to economic status.

Who do you think benefits the most from rent control and why?

RENTER: Rent control allows those with lower incomes to stay within a community adding long-term stability as a benefit. Since people are not necessarily paid according to the value of their work (Think of musicians, artists, dancers, writers, as well as retail sales folks, day care providers, waiters, waitresses, etc.) rent control allows them to accept lower paying jobs and still have a quality of life where they are not shoved into poverty pockets. In fact, if rent control were 3-5% of every building, we could eliminate projects and end segregation according to economic status. LANDLORD: Short term will have less return on revenue. Long-term will increase the value of the community allowing higher rents in remaining units. Now I am going to read "Rent Control: Myths and Realities" so I can learn why my theory is all wrong.

I think it benefits persons living on fixed income.

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