Answering Challenges to Advanced Economies

Policy Stories

Contributing Scholar: David Henderson

The Enduring Failures of Rent Control

Rent control promises to reduce housing costs, but in practice it constrains supply, degrades housing quality, and discourages new construction. Even after those failures become clear, the policy remains difficult to repeal because it protects those already in the market while leaving prospective tenants to compete for a shrinking supply.

The Enduring Failures of Rent Control

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The Enduring Failures of Rent Control

Comment

Published April 16, 2026

Rent control is presented as a way to make housing more affordable, but it does the opposite. By holding rents below market levels, it reduces supply, discourages maintenance, and weakens incentives for new construction. The result is fewer available units, lower housing quality, and a market that works less well for those trying to enter it. Its political durability is part of the problem. Rent control protects incumbent tenants while outsiders face a tighter supply, lower vacancy rates, and a harder search. By contrast, gasoline price controls in the 1970s were easier to repeal because the costs were visible and broadly shared. Rent control persists because its benefits are concentrated among those already inside the system, while the costs fall on those still trying to get in.

Learn more from David R. Henderson:

Read "Rent Control Creates Privileged Tenants" by David Henderson here.
Read "Phil Gramm and Donald Boudreaux, Economic Myth-Busters" by David Henderson here.
Read "The Economics of Oil Prices" by David Henderson here.

Learn more about David R. Henderson here.

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The opinions expressed in this video are those of the authors and do not necessarily reflect the opinions of the Hoover Institution or Stanford University.