Economists also universally agree that free trade creates the most wealth. But this assumes that distribution and dislocation effects are ameliorated with wealth transfers on the side.
Nobody disagrees that rent control increases the average rent. The question is whether it's a worthwhile trade-off. I tend to see it as a tax on the young for the benefit of families and the elderly. In a city like San Francisco a worthwhile trade-off.
In reality, turnover tends to be relatively high in cities, and especially in San Francisco. For large apartment buildings the marginal increase in rents induced by rent control are very small. For smaller apartment buildings the risk to the landlord is greater (potentially less turnover, fewer opportunities to reset baseline to market prices). This is why I think that rent control should go hand-in-hand with density.
Rent control also increases the appeal of renting relative to purchasing as it provides the same ongoing expenditure stability. If we get rid of rent control we should simultaneously remove all incentives for home ownership. But we all know that the latter is politically infeasible. Why should we expect rent control to be any less politically infeasible? Because we tend to perceive the proponents and beneficiaries of rent control as starry-eyed liberals?
In a city like San Francisco the biggest culprit of high rents, aside from sheer demand, is zoning and the arduous approval process. All this finger wagging over rent control is counterproductive and tone deaf. If we remove rent control the biggest problems will remain. If we address the biggest problems then the "problem" of rent control will largely recede.
The same logic applies to Georgist Land Value Taxes. Conceptually they're the best way to maximize efficient use of land. But we know that they're politically infeasible. No Georgist LVT system has ever survived without exceptions and loopholes making the system honored only in the breach. We cannot underestimate the social value of price stability for something as important as housing. If you ignore the fundamental need, bad things will happen like Proposition 13.
Nobody disagrees that rent control increases the average rent. The question is whether it's a worthwhile trade-off. I tend to see it as a tax on the young for the benefit of families and the elderly. In a city like San Francisco a worthwhile trade-off.
In reality, turnover tends to be relatively high in cities, and especially in San Francisco. For large apartment buildings the marginal increase in rents induced by rent control are very small. For smaller apartment buildings the risk to the landlord is greater (potentially less turnover, fewer opportunities to reset baseline to market prices). This is why I think that rent control should go hand-in-hand with density.
Rent control also increases the appeal of renting relative to purchasing as it provides the same ongoing expenditure stability. If we get rid of rent control we should simultaneously remove all incentives for home ownership. But we all know that the latter is politically infeasible. Why should we expect rent control to be any less politically infeasible? Because we tend to perceive the proponents and beneficiaries of rent control as starry-eyed liberals?
In a city like San Francisco the biggest culprit of high rents, aside from sheer demand, is zoning and the arduous approval process. All this finger wagging over rent control is counterproductive and tone deaf. If we remove rent control the biggest problems will remain. If we address the biggest problems then the "problem" of rent control will largely recede.
The same logic applies to Georgist Land Value Taxes. Conceptually they're the best way to maximize efficient use of land. But we know that they're politically infeasible. No Georgist LVT system has ever survived without exceptions and loopholes making the system honored only in the breach. We cannot underestimate the social value of price stability for something as important as housing. If you ignore the fundamental need, bad things will happen like Proposition 13.