Rent control has the efect of locking people in and reducing mobility, favoring those already in the market at the expense of those looking to get in to the market.
how does rent control lock people in? only if moving is not possible without raising rent. effective rent control is about preventing excessive rent, not about preventing the raise of rent to existing tenants.
as far as i can tell, the effect of rent control in germany is mostly that similar properties cost a similar rent which does not prevent people from moving, because they are not risking an increase just because of the move.
how would additional supply fix that? there is no space in the city to build more. additional supply would happen at the edges, where most people do not want to move until the area is sufficiently developed, and there are local jobs too.
a more desirable area will always be more expensive. rent control allows to keep that in check, no control will mean that even if there is enough supply elsewhere, those more desirable areas will remain expensive. rent control is needed to prevent gentrification too.
Infill development comes with its own challenges. A coordinated effort to increased density in a city would necessarily be disruptive to a lot of people's housing. That's not to say it shouldn't be done, but it complicates the matter if you care about displacement, right-to-return, etc.
That's what all NIMBYs parrot. Berlin population only grew by ~250k people ... since 1990, and back then Berlin was basically depopulated. It's also one of the least dense capitals in Europe today, Berlin is not Amsterdam to not have any space.
Saying "there's no more space" doesn't pass the smell test. There's more than enough space but there's too much real estate speculation going on to jack up the prices because certain interest groups need to make money from it.
>most people do not want to move until the area is sufficiently developed, and there are local jobs too
Once that area is sufficiently developed it's too late to move because you'll already be priced out. If you want to live somewhere you need to move thee before it becomes "cool" and "hip".
Berlin population only grew by ~250k people ... since 1990, and back then Berlin was basically depopulated
ok, fair point. so berlin does have other options. but the rent problem is not only in berlin, and other cities don't have that space. and nevertheless i stand by the claim that even if more rental units are going to be built in that space, rent prices will not go down without any additional effort.
a good example of doing it better is vienna. somewhat similar to berlin, population was shrinking until the turn of the century. down to 1.5 million. then suddenly in the last 20 years it grew back to 2 million. faster than berlin. vienna government itself is building new housing (a program that started 100 years ago). and infrastructure with jobs to go with it. 25% of people in vienna live in government owned and subsidized housing. (apparently berlin has something similar, but it is privately owned with a government mandate)
Once that area is sufficiently developed
ignoring the option to work remote, if an area doesn't have jobs close enough to easily reach by public transport i am not going to move there, no matter how attractive the rent.
that is about an additional more restrictive form of rent control on top of the already existing nationwide rent-control laws:
"The court ruled on Thursday that the Berlin government had overstepped its powers in introducing the law, as federal law governing rents was already in place."
this does not support an argument against rent control in general, but only against outright freezing rents in place which is what this law tried to do.
the stories about landlords getting around the rent limit by charging extra for furniture are also not helping the argument because the law covered that too, so they were effectively breaking the law. the only argument that is valid is the fact that less units were available for rent, showing that this particular law didn't work. but again, this does not prove that rent-control on general is bad.
german rent-control generally means that rent may not be charged higher than about 20% of the average rent in an area. this means that rents are still somewhat flexible and they can rise, but not excessively so.
Rent control in Germany also fixed the housing shortage and creates great incentives for new construction. In 2022, Germany had a record in new apartment and buildings finished - 2023 will probably even better. The new ECB interest regime of 4+% actually had very limited effect on the market in this respect thanks to rent control.
Like honestly, rent control is just beyond dumb. There are like 1000 ways that actually solve the problem - but unfortunately they require cities and bureaucrats to work instead of just passing a law. Supply and demand. If it takes LONGER to get a building permit that to actually build a housing complex… When cities are not planning ahead creating new space (argh, infrastructure, public transportation, this sounds like work…
i am a bit confused. rent control in germany works, but then you are arguing against it?
actually i disagree that simply allowing to build enough property will work. businesses tend to charge as much as they can, and if we want actual competition in rent prices, then the supply would have to vastly exceed the demand and not just meet it. with all the best intentions, that is not going to happen, and i don't think it is desirable either.
> and if we want actual competition in rent prices, then the supply would have to vastly exceed the demand and not just meet it.
So, having less than 1% of the housing stock go to AirBnB supposedly makes cities unaffordable but increasing the supply of housing will not have the opposite effect until supply greatly exceeds demand? Why?
because prices aren't lowered until there is pressure to do so. and that won't happen until enough properties remain empty that it starts to cost money. as far as i can tell, the preference currently is to leave properties empty instead of renting them out at low prices, so all creating more supply will do is to create more empty properties, unless landlords are literally forced to rent them out at lower prices.
Rent control has the efect of locking people in and reducing mobility, favoring those already in the market at the expense of those looking to get in to the market.
The obvious solution is to build more.