
Rent control will make housing shortages worse - prostoalex
https://www.economist.com/leaders/2019/09/19/rent-control-will-make-housing-shortages-worse
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merricksb
Discussed 4 days ago:

[https://news.ycombinator.com/item?id=21022491](https://news.ycombinator.com/item?id=21022491)

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baby
I'm not sure I understand these kind of articles. There's two harsh truth for
me:

* It would be crazy not to rent a rent-controlled place in a market like SF. This is what everybody tries to do here, and honestly I would probably not have moved here if I couldn't have found a place without rent-control. It is just too risky (your rent can pretty much double in a week, forcing you to move out).

* SF's real housing problem is that there's a lack of housing. This has nothing to do with rent control, and focusing the story on rent control is like ignoring the bigger elephant in the room. It's a malicious distraction tactic. Check the numbers, the population of SF has remained extremely stabled since the 90s[1], the reason is that there's no more space for people to live.

Ask yourself this question, who would be the biggest benefactors from removing
rent control?

[1]:
[https://www.google.com/search?q=sf+population&oq=sf+populati...](https://www.google.com/search?q=sf+population&oq=sf+population+&aqs=chrome..69i57j0l5.3023j0j7&sourceid=chrome&ie=UTF-8)

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mdorazio
To your points:

1) People not moving to markets like SF because rent is too high _and telling
employers that_ is exactly what _should_ happen! This forces employers to
either lobby for more housing (a good thing) or open offices in reasonable
cost of living locations (also a good thing) instead of continuing the status
quo bubble. Rent control is a market distorting force in this case.

2) Rent control directly leads to fewer new housing units because there is a
disincentive to create housing that's going to rent for below-market. If you
want more housing, you should be opposed to rent control. I say this as
someone who benefits greatly from rent control and still wants to see it die.

3) The population of SF has _not_ remained extremely stable since the 90s.
Look at [1]. There were 140,000 fewer people in the 90s than there are today
(a 20% increase)! Also your reasoning that "there's no more space for people
to live" is demonstrably false. Go visit Tokyo and then tell me there's no
space for more people in SF. There's no more space because zoning laws and
height restrictions in the city are absolutely ridiculous and serve NIMBY
interests.

[1]
[https://en.wikipedia.org/wiki/Demographics_of_San_Francisco](https://en.wikipedia.org/wiki/Demographics_of_San_Francisco)

Edit: since someone is no doubt going to ask, here's a good summary of the
economic literature on the topic. It covers a variety of effects related to
rent control: [https://econjwatch.org/File+download/238/2009-01-jenkins-
rea...](https://econjwatch.org/File+download/238/2009-01-jenkins-
reach_concl.pdf)

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JamilD
With respect to point (2), the argument doesn’t really work for SF; rent
control only applies to units built before 1979. New developments can raise
the rent as much as they want.

You could argue the _threat_ of possibly having rent control discourages new
building, but it’s a much weaker argument.

Your points in (3) I think are much, much more relevant to the SF housing
crisis than rent control.

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martin_bech
Sure it will. In Denmark we actually have a split because of this. Buildings
built before 199x have rent control, all new buildings can have “free” rent
set. If you believe you are subject to an unfair rent, you can go before a
comittee that can reduce or enforce it. A landlord can also get the rent
preapproved by the same comittee, to avoid any risk. Any rent contract has to
follow a certain format, and rent increases have to be listed in advance, such
as “the rent for 2019 is x, and will increase each year in january by 3%”.

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MiscIdeaMaker99
I'm no expert, but I do know that in Indianapolis we've had many housing
developments in the downtown area that have a requirement for a certain
percentage of units to be rented below market rate.

You have to apply to rent those units, and you must meet the income
requirements, in that you can't make above a certain threshold if income. (Not
sure what other factors are taken into consideration.)

To me, this seems like somewhat of middle ground between being 100% market-
driven vs. full-on rent control.

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tudelo
They do this in New York too, I'm not sure of the scale or laws around it, but
for new development I think they need a certain percentage of units as income
restricted.

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amyjess
The purpose of rent control is to keep existing tenants from getting priced
out of their homes with annual rent increases, not to make housing affordable
for new tenants.

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ChuckNorris89
It's the same in desirable European cities with rent control like Berlin and
Vienna.

You read about people renting huge apartments there in the city center for
decades paying something around 600/month while if you'd want to move in now
into a similar sized apartment in a similar area you'd be paying a lot, _LOT_
more.

Rent control makes it affordable for people that have been living there long
term but makes it more expensive for the ones trying to move in now.

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tehjoker
Who is posting these articles? Landlords? Rent is the most exploitative
arrangement in the economy. There is a landed class, an aspiring class, and a
class that is purely exploited. Everyone needs a place to live and it should
be provided for free or at cost. The market is destructive and benefits the
few at the expense of the many.

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clay_the_ripper
Would you care to explain? I’m a renter and I find it be a great arrangement.
I have no interest in owning the property that I reside in. I can move anytime
I want, I don’t have to fix anything and I can park my money in things that
return far more than a house.

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ahelwer
Renting works well for highly-paid professionals who aren't committed to
living in the area for the long haul and have plenty of money left over after
paying their landlord. That's a very niche subset of people who rent. The more
common scenario is people spend 1/2 to 2/3 of their take-home pay on rent to
avoid a hellish commute, living with roommates in a poorly-managed building
where the owners drag their feet fixing anything. These people don't have
money to "park" in things that return far more than a house.

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msoad
I know too many software engineers with $200k salaries living in $2000/Mo rent
controlled apartments in San Francisco. They are the last people needing any
help with their rent. Sometimes they have extra room they Airbnb which reduces
their rent even further

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uoaei
Yes, rent control doesn't magically solve the problem by itself. But it shores
up the defenses of less-advantaged renters. Of course some opportunistic high
earners will insert themselves into this system. There should be something in
place alongside rent control to minimize that.

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zo1
I'm a free-market kind of person. But I think that the problem with
politicians' / planners' tinkering here is that it's inherently gimped/broken.
Tinkering and tweaking the rules/details of society only kinda works if you're
able to do it a lot so you can constantly "respond" and stay ahead of the
changes and responses in the market. Whether as byproducts of the regulations,
or in opposition to them.

The market and the people that form part of it will always respond, and modest
tinkering will always fall short because (from my perspective) it seems
downright impossible to make version 2.0 after implementing version 1.0 of the
tweaks. At best, you get 1.1 or 1.2, and after that a perpetual 1.x.xxxxx set
of patches that are only tiny changes in order to appease special interest
groups.

And the reason (I would posit) is that the rules/system of government we seem
to have in place make this sort of stuff next to impossible. Whether it's from
special interest groups, meddling activist judges, flip-flopping politicians,
lobbying, partisan voting, corporate meddling, lack of real public buy-in and
participation, lack of referendums, anything. It's gimped so we get the crappy
part of the constant "tweaking" and "optimizing" by politicians, all while
having to do PR for their changes/ideas and a public that is almost exactly
divided on the issues.

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rhinoceraptor
And it seems pretty obvious to me that the rules now are (as much as they
claim be pro-social justice), are only in the interests of property owners.

And it's not like rent control is the only way for there to be affordable
housing. It's just a way that pretends to look out for lower income people,
while actually benefiting entrenched property owners in a really perverse way.

