Rent Control Perspectives

Rent Control Perspectives

Across the country, professors, economists, editorial boards, businesses and policymakers agree: rent control does more harm than good.

“Oregon’s new [rent control] law will not fix the underlying problem of high housing costs, and it could even make matters worse for vulnerable families… The only effective long-term fix to the housing scarcity challenge is to build more housing—especially building less expensive housing in cities and neighborhoods where demand is high. This would require substantial changes to local zoning in nearly every U.S. city.” Jenny Schuetz, Brookings Institution 

The history of price controls on rents tells us what is likely to happen now in Oregon. Rent restrictions create an incentive for developers to maximize profits by building high-end apartments rather than units affordable to lower- and middle-class families. Some developers may opt not to build at all in Oregon..” The Wall Street Journal Editorial Board

“Rent control would seem to be the easy fix. Just cap what landlords can charge. But it’s a superficial and ultimately counterproductive fix, as the experiences of other cities have shown. And there are better ways to address the problem of too little affordable housing in Chicago.” — Chicago Sun Times Editorial Board

“Nothing comes for free. The cost of rent control would be borne throughout the city in ways that, over time, would leave Chicago worse off. Even for many renters.” — The Chicago Tribune Editorial Board

Rent control never delivers on the promise that it will multiply the affordable housing in high-value markets to serve middle- and lower-class families. It also always has negative consequences… Rent control didn’t provide more affordable housing when it was implemented in various regions back during the ‘70s, and it hasn’t worked since.” — Veronique de Rugy, Ph.D., senior research fellow, Mercatus Center at George Mason University

The more extreme forms of rent control give landlords an incentive to destroy their buildings, while even milder rent-control laws lessen the incentive to build new units and fully maintain existing buildings. Even when rent control does not initially cover newly constructed units, it may later be extended to cover those units, so the mere existence of rent control is a disincentive to build new units even if they are initially exempt from rent control.” — Hans Bader, Senior Attorney, Competitive Enterprise Institute

“Despite its populist appeal, rent control is the wrong answer to the state’s housing crisis. The policy benefits only those tenants who occupy controlled units, who are not necessarily the most vulnerable, at the expense not only of landlords but also of other renters. Moreover, rent control diminishes the supply and maintenance of rental housing, exacerbating the shortages that drive up rents. That’s why economists broadly reject the approach” — San Francisco Chronicle Editorial Board

[Rent control] will do nothing to solve our housing crisis, but it will exacerbate it […] Instead, we need to focus on working together to create more housing supply (market rate and affordable) and only passing good policies through a thoughtful and deliberative public process. We need policies that don’t punish private industry, curb development and reduce rental housing supply.” — Region Business

“The prospect that a city may enact rent control in the future is enough to chill investment in rental property and could blow up countless pending deals for new construction. Trying to fix a housing crisis with rent control is like sending an oil tanker to put out a forest fire.” — Orange County Register Editorial Board

“History shows rent control makes housing problems worse. Economists overwhelmingly agree that it reduces the quantity and quality of housing, and a study published last year by three Stanford academics found rent control in San Francisco led to a sharp decline in available units. The best and only answer to a housing shortage is more housing.— The San Diego Union-Tribune Editorial Board

“Rent control appears to help affordability in the short run for current tenants, but in the long-run decreases affordability, fuels gentrification, and creates negative externalities on the surrounding neighborhood.” — Rebecca Diamond, Associate Professor of Economics, Stanford Graduate School of Business

In areas where tenants face rent increases above earnings but below the cap, rent controls will have no effect. Increases will eat into families’ incomes further, and with affordability worsening, tenant groups are likely, in time, to demand tighter controls. Yet where market rents really are spiraling, capping them to prevent so-called “economic eviction” dampens the incentive for developers to bring new supply to market. Some tenants will benefit from lower rents. The cost will be worsened availability of housing precisely where it is needed most.” — Ryan Bourne, R. Evan Scharf Chair for the Public Understanding of Economics, Cato Institute


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