Rent control effects: An almost complete review of the literature
The study reviews research on rent control, highlighting its ability to slow rent growth while also causing negative societal impacts, such as reduced housing supply and quality, emphasizing context-dependent outcomes.
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This study reviews a substantial body of empirical research on the effects of rent control, a policy that has been a topic of debate since World War I and has gained renewed attention in recent years due to housing shortages in various cities and countries. The review aims to assess whether rent control is beneficial or detrimental by examining its impacts on socioeconomic and demographic factors. The findings indicate that rent control can effectively slow the growth of rents for controlled dwellings. However, the policy also generates a range of negative consequences that affect society as a whole. The analysis includes a discussion of the direction and degree of consensus among researchers regarding the most significant effects of rent control. The study highlights the complexity of the issue, suggesting that while rent control may provide short-term relief for tenants, it can also lead to adverse outcomes, such as reduced housing supply and quality. The research was presented at workshops in Berlin and Rennes in 2023 and was supported by the European Union's Horizon 2020 and Horizon Europe programs. The authors emphasize the need for a nuanced understanding of rent control's implications, as the policy's effectiveness and consequences can vary significantly based on local contexts and implementation strategies.
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8 commentsSomething too expensive? Just force the price to be lower. It's such a simple message that it will be one of those things every generation will 'rediscover' as the solution to everything.
> This could involve the construction of public housing or financial support for private investors engaged in social housing development. Consequently, the total number of completed dwellings can remain steady or even rise, potentially leading to a misinterpretation of rent control's impact as beneficial.
I'm not quite sure why this wouldn't count as beneficial. The place I live even has such a goal (30% non-profit landlords, renters usually become member of the non-profit when they rent).
"Rent controls appear to be quite effective in terms of slowing the growth of rents paid for dwellings subject to control. However, this policy also leads to a wide range of adverse effects affecting the whole society."
So you get the first order effect you wanted "rent stays low in the area" but you get all kinds of adverse second order effects (higher rents outside controlled areas, poorer maintenance, lower new construction rates, etc.)
Regulation on the amount of holiday rentals would aliviate some of the pressure on the market.
Taxation on empty apartments, second house and higher as more properties a single entity can have.
Housing should be seeing as a social right and not as an investment. Law should reflect that
Eliminate the rent seeking class as a set of buyers from the real estate pie and force developers through permitting to only sell — not lease their properties.
Those who disagree will always be some form of a landlord. Remember, landlords provide housing the same way scalpers provide tickets.
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