The Case Against Rent Control
Actually, that’s a bit presumptuous. Let’s just call it a case against rent control, which I wrote for the Freeman. An excerpt:
There are further, more insidious problems with rent control. With a long line of potential tenants eager to move in at the official ceiling price, landlords do not have much incentive to maintain the building. They don’t need to put on new coats of paint, change the light bulbs in the hallways, keep the elevator in working order, or get out of bed at 5:00 a.m. when a tenant complains that the water heater is busted. If there is a rash of robberies in and around the building, the owner won’t feel a financial motivation to install lights, cameras, buzz-in gates, a guard, or other (costly) measures to protect his customers. Furthermore, if a tenant falls behind on the rent, there is less incentive for the landlord to cut her some slack, because he knows he can replace her right away after eviction. In other words, all of the behavior we associate with the term “slumlord” is due to the government’s policy of rent control; it is not the “free market in action.”
In the words of Assar Lindbeck, Rent Control is the most effective means found of destroying cities, except bombing.
Dr. Murphy.
What would you say about the urban ground rent control in the form of taxes (like the georgist single tax) or regulations? Would it be just like the rent controls, with similar consequences?
thanks,