return2ozma'Renters Are Struggling': Economists Back Tenant-Led Push for Federal Rent Control
flossdailyMy understanding is that rent control backfired pretty spectacularly in the long term.
The better plan here would be to stop companies from buying residential properties, to incentivized the conversation of commercial properties into apartments, to penalize banks and individuals who are sitting on unused residential properties.
Oh, and wipe out all student loan debt so that younger generations have a prayer of buying a house someday.
girlfreddyWho told you rent control backfired? Cause that's a lie. It was just never adopted as widely as it should have been, and rich owners always have the ear of lawmakers ... the same can't be said of poor/working poor people.
Like… Every economist:
Capitalist/free market* economists.
Rent control works just fine in a more socialist model, especially when the government is a prime builder of housing without seeking profit, as almost every European country was during the 50s-70s. It’s only when government gets out of house building and everything gets privatisated and for-profit that rent control fails.
You may want to look at how rent control turned out there, and why Europe is broadly turning against rent control, and seeing it as a mistake
bloomberg.com/…/berlin-s-rent-controls-are-provin…
I unfortunately can’t read that article as it’s paywalled, but looking at the link, it’s an Opinion piece, so not factual reporting. It’s also from Bloomberg, one of the most pro-capitalist publications out there, second only to The Economist in its championing of all things pro globalist and pro capitalist.
The main stream media which is all very pro capitalist (as they’re all owned by billionaire oligarchs) has been shitting on rent control for decades. And yes, if your society is purely one of free market capitalism, and crucially government doesn’t build housing, then yes, rent control tends to work poorly.
That article a literally about how rent shot up because of rent control policies.
Rent didn’t shoot up, how could it, the whole point of the law was it was frozen.
I think you’re missing the forest for the trees in this entire conversation: rent has been skyrocketing everywhere, in every G8 country, for the last 20 years. Especially in places like London, NYC, LA, Seattle, Paris, Toronto, Bay Area, etc. Hell, even in Salt Lake City where I used to live my rent went from £1816/mon to £2600/mon for the same flat, in just 2 years. And none of those cities have classic rent control (NYC has a few places which have it, but overall it doesn’t). So clearly with a free market, pure capitalist approach, rents have only been skyrocketing. Same thing for housing to buy, have you tried buying a house lately?
So to claim that rent control or rent freezes lead to higher rentals or less supply is wrong, because rents are going up in a free market too, and supply is already at an all time low (hence the prices shooting up).
So you’re fucked in either situation. The real problem is there just isn’t enough supply of shelter for people, and that’s because if you leave it to the free market, there’s no incentive to build affordable housing with no profit. Hence, because shelter is something required by citizens, government should be building it even at a huge loss. Just like government provides fire brigade and military at a financial loss, because people need these things. You don’t leave essential services to the private market because it may not be profitable to do them, for example, rural communities have shite internet, why? because it’s not profitable to dig and lay fibre optic cable into some rural hinterland for just a few hundred customers. So in Norway, the government steps in lays that fiber optic at a financial loss because it wants its citizens to have a better life. Same for housing. If the private sector isn’t doing it, the government should be. Just like in the 60s.
Rent goes up because we have insufficient housing construction, and we have insufficient going construction ecus zoning laws prevent housing construction.
I am aware that the government can encourage building and it should do so. Vote locally to repeal zoning laws.
If government says the private sector cannot do something, then yeah you’ll see few or no businesses doing that thing.
Zoning is only a small part of the problem. Even if you zoned a bunch of new land today, if you let the private, free market have its course, then what do you think will be built on that land? Highly unaffordable luxury flats/houses, because that is what leads to the highest profit margins for the private sectors builders. And those flats will be bought up by investors or wealthy individuals to create more unaffordable rent.
That’s the core issue, individual private sector interests are not aligned to be altruistic interests for the good of society. They want to maximise profit, nothing more. Hence, you need someone willing to build houses and sell them at a loss, so average people can afford housing again. Only the government can sell for a loss and remain in business.
Ergo, you can zone all the land you want, but if you only let private sector builders have it, then you’ll just get more and more unaffordable properties built, chasing rich foreign investors, tech millionaires, or pension funds.