Lone Candle

“all of these policies share a problem if enacted as the exclusive solution to rising rents. As economists often stress, rent control fails to address the core issue of why housing is so expensive to begin with: lack of supply. In particular, states and cities have a bevy of rules and regulations regarding what kind and size of new homes can be built that overwhelmingly make it illegal or unprofitable to build small single-family homes, multi-family homes, and dense neighborhoods.”

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“Rent control should be understood as a remedy for displacement, rather than a solution to the spiraling cost of housing. It’s best as a measure that can help keep current tenants from being displaced from their neighborhoods”

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“It’s become abundantly clear that even if states do begin to build more homes, it will take years if not decades to rebalance supply and make housing more affordable, and in the meantime millions of families will continue to suffer. Economists are right to be worried about the ways rent control could worsen the housing crisis, but rent control can work.”

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“A well-designed rent control policy exists in tandem with eliminating exclusionary zoning laws, reducing the cost of housing construction, and providing universal vouchers to help low-income tenants afford their rent.”

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“To encourage people to still build more homes, it is important to exempt future construction from rent control and to allow landlords to increase rents annually by a moderate sum tied to inflation. Policymakers also want to make sure there are incentives to keep existing rental stock well-maintained; one way to do so is by allowing for vacancy decontrol so that when a tenant moves out, a landlord can upgrade the unit and charge a higher rent to the next tenant.”

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“When it comes to worries that rent control policies might increase evictions (both formal and informal) as landlords are motivated by profit to convert to condos or force their tenants to vacate so they can renovate, the answer is that, similarly to all types of abuses of power in the market, there needs to be more oversight. A few policies that cities and states should enact are:

Just cause eviction statutes, which would require the landlord to justify kicking a tenant out of the property. The government can define what a reasonable justification is, including but not limited to failure to pay rent, desire to add another tenant to the renter’s lease, violation of lease terms, illegal activity, etc.

Right to counsel to ensure that tenants are not just getting steamrolled in these types of hearings. Numerous studies have pointed to the fact that the vast majority of tenants are going unrepresented by counsel.

A rental registry to keep track of tenants and landlords. One of the biggest factors leading to informal evictions is that the power imbalance between very low-income tenants and landlords leads the former to simply comply when told to leave their home, even if they have the right to stay. By creating a rental registry, landlords will know that their lease terms are being monitored by local officials and that they will be easily caught if they informally or illegally evict tenants in order to get around rent control laws.”

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“Skeptics will correctly note that implementing all these ideas would increase the costs of renting out properties, which might push some landlords toward condo conversions or away from developing new units. That’s why it’s important to simultaneously make it cheaper and easier to build and renovate housing. As almost all urban economists have noted, the primary constraint on housing supply in America’s cities and suburbs is the regulatory morass that drives up the cost of developing and producing new homes and makes it nearly impossible for a landlord to extract multiple rents from a single lot by building multi-family housing.”