Updated over 7 years ago on . Most recent reply
Rent Control, Entitlement, Free property or Property Rights?
What do you all think of these rent control and other rent regulations like capping rents and landlords abilities to earn income to pay for repairs and all the expenses of owning property? Rent control on a surface level seems helpful and simple enough but really it contributes to housing shortages, bubbles, and all sorts of political greed. In the end the people who benefit from the rent control are people who are entitled and take advantage of the system. It's never for what they try to sell you on.
Renter's day
There's a lot of political push to do rent control and expand rent control from Seattle to Chicago to New York. From Los Angeles to Dallas to Florida. It's crazy.
Some of the big groups coming up. A lot are actually trying to pit landlords and us investors against tenants. It's sad because most landlords are just small scale investors like the ones here who are trying to make payments from mortgage, insurance, repairs, cap expenses etc. They call us "Greedy landlords"
http://www.tenantstogether.org/events/renters’-day...
If you dig deeper these groups are funded by huge large scale politicians who really want to get mass votes.
Economic rent control articles
https://fee.org/articles/the-case-against-rent-con...
https://www.economist.com/blogs/economist-explains...
Note some signs being held are for socialist party and entitlement rights.
Any thoughts?
Most Popular Reply
Let the free market decide the rent price. Capping rent affects the value of the property significantly. Why should the government dictate how much your property is worth? By controlling the amount of rent you can receive, this places a cap on the value of the property as well. Owners are less likely to improve their properties to market conditions due to deflated rents. Enacting rent control in NYC has had some really negative consequences, those costs are still being paid, albeit not by the consumer.
There are reasons all owners do not improve their rental houses year over year, sometimes there is a demand for lower quality homes with inexpensive rents. If they improved these homes to an average level, they would also want to increase the rent to an average level as well. Last year in Dallas the mayor and a slum lord got into a spat because the houses weren't in livable condition according to the city. The slum lord said to bring them up to code he would have to raise rents significantly or close down the properties. He opted to close down the properties, in part due to the costs. This had the effect of displacing hundreds of residents who had been paying an average of $400-500 per month for their rental house. The market rate of rent is likely closer to $1000 depending upon the quality of the residence. So yes, sometimes there is a need for substandard housing. Its not pretty, I personally would not choose to live in those conditions, but for some it is a reality. To think that the world owes you something is a fallacy. The world does not owe you a class B property. In fact the populations in undeveloped nations are likely living in worse conditions.
Rent control will never force someone to pay above market price; it will only be used to prevent the market price of rent from being paid. The city can enact different strategies to improve living conditions and home ownership, like raising property tax for non-owner occupied residences. The city can build its own rent free complexes as they operate for a different goal than a private investor.