[kareemsabri]

> Am I wrong, or would it just be better to create more housing in ways that created affordable housing (rent control, public housing, and so forth) instead of trying to see if "market" forces of supply / demand fix the issue?

I think you're probably wrong, yes. Having lived in cities with rent control, what I've observed is people who get into a rent-controlled apartment simply NEVER leave it. They pass it down to family members. They unofficially sublet it for years. They are not particularly poor, they just are paying below market for rent so why would they ever give up that sweet deal? And therefore one rental unit is off the market, and the rest of us are competing for the remaining apartments and subsidizing the low rental unit. I would prefer we let rents equalize based on supply and demand, and the government just supplement the rent of low income individuals.

[Sebguer]

> Having lived in cities with rent control, what I've observed is people who get into a rent-controlled apartment simply NEVER leave it.

Yes, because they're rare, and the only way to not be uprooted. How are you posing this as a bad thing? If there were more rent control, then this wouldn't be a problem. Why should rent get to rise so drastically above inflation? The core reason it does today is because people are buying them endlessly as investments, and as the property exchanges hands at completely arbitrary values, the new owners have to raise rents.

[yojo]

Pretty sure you have this backward. Landlords don’t get to decide how much people are willing to pay to rent. They charge the market clearing price (or as close to it as possible).

This isn’t based on what they paid for the property, though the value of a property will at least in part be based on the income it can generate.

If rents seem too high, it is because demand has outstripped supply, and the marginal renter in the market has more money than you do. If you want rent to come down for everyone, you can:

1. Reduce demand by making the area less desirable.

2. Increase supply by making more rental units.

Rent control is just a lottery that benefits the people lucky enough to get it at the expense of everyone else.

I had a rent controlled apartment for 5 years in San Francisco. Which, incidentally, I was subletting from someone who had moved to LA but didn’t want to lose his place in case he came back. In no way was I deserving of special financial treatment, I had a high paid tech job, and a wife making decent money. Anyone else who moved into my neighborhood was paying literally double when I left.

It was nice to randomly get a $20k/year windfall, but did not feel like sound housing policy.

[lutorm]

Sounds kind of similar to the idea of bringing gas prices down through a "gas tax holiday"...

[1123581321]

Rent control is well studied. Several bad things happen in rent controlled areas. Non-controlled rents rise. Gentrification accelerates outside of the protected buildings. People live somewhere they don’t necessarily want to be. Units are converted into lower density housing to drive up price. Commutes lengthen. If the city becomes less of a draw in the future, the controls don’t allow graceful lowering of prices.

In contrast to most economic issues, rent control has robust bipartisan opposition.

[sudosysgen]

Rent control needs to be implemented well to work. Badly implemented rant control doesn't work. Everything you're describing comes from rent control not being universal, to prices being allowed to increase between tenants, and to zoning laws allowing the construction of low density housing in high density areas instead of only allowing low and medium density.

You can encourage graceful lowering of prices by putting in inoccupancy taxes.

Rent control is easy to fuck up, and almost every place in the US that implements it half asses it by either making it only apply to part of the city, allowing unlimited rent increases between tenants, disallow reasonable rent increases for improvements, and so on. Rent control has to be implemented well to work. There are plenty of examples of cities where it works wonderfully, and plenty of places where there is multipartisan consensus in favour of them.

[1123581321]

Occupancy taxes and codified reasonable increases can’t create a dynamic rent market. Even if an entire city were to be put under a construction freeze, which would be incredibly unhealthy, problems would spill into suburbs. The rest is just re-assertions and a wish for perfect city planning.

[sudosysgen]

The purpose of inoccupancy taxes and reasonable increases is to remove any disincentive to move out from your rent controlled appartment. So as long as there is not massive influx into the city outpacing constriction, there will be a dynamic rent market.

I don't understand what you're getting at with construction freezes and so on. The basic principle is that badly implemented rent control in badly palnned cities can exacerbate problems, while well designed rent control in well planned cities can solve problems. It's not a magic bullet but its not a curse either.

[1123581321]

Construction freeze probably wasn’t the best term. You were saying that workarounds to increase revenue wouldn’t be permitted and those would have to be comprehensively restrictive.

This is a big topic; I guess I’d say to just read more about how it’s gone historically and why “just do it better” isn’t viable. Appreciate the zeal.

[kareemsabri]

> How are you posing this as a bad thing?

It should be self-evidently a bad thing that a small number of people benefit from artificially low prices, up to 1/3rd of whom are not low income (from what I've read).

I don't have a strong opinion on whether rent should be "allowed to rise above inflation", though I don't think you understand how pricing works in a market system. There is a market clearing price, which is not dictated by the price that the owners buy it for.

I'm not opposed to more radical solutions to housing distribution, as a lifelong renter I'm certainly not happy about the money I pay in rent annually, but I don't see how the status quo of rent control does much to help control prices.

I also pay a very high rent currently, but my landlord also loses money on the building maintenance and upkeep, as well as regulatory compliance costs. So it's not that simple.

[einpoklum]

> It should be self-evidently a bad thing that a small number of people benefit from artificially low prices

1. Nothing artificial about it.

2. Just expand the fraction of rent control and more people will enjoy it.

3. If X% of renters are in rent-control apartments, they don't contend with us on non-rent-controlled properties. That's not a huge effect but it's _an_ effect.

4. "My landlord also loses money" - ok, I call BS. Either you're not a renter or you have some other kind of ulterior motive. Your landlord makes money off of you, and is not renting out as a form of charity; plus, they're already rich, owning (most likely) their own accommodation and the apartment they rent out to you.

[sudosysgen]

i live in Montreal. Every appartment is rent controlled. People move out en masse every year. The issue is rent control only applying to a few appartements and not every appartment, and not having allowances to keep prices low when tenants move.

[kareemsabri]

That's an issue. It's debatable whether it's the issue. But yes, obviously if every apartment has the same rent ceiling nobody will have a reason to stick in one of the lottery apartments forever. Good luck getting that passed in NYC/SF.

[sudosysgen]

Deep down, another goal isn't just to lower rents, but actually to lower property costs, and well implemented rent control helps do that. I agree it's going to be hard to get that passed, but that's going to be true for literally any real solution to housing because they all imply hurting the mass of current real estate investors very hard.