Is Rent Control Good or Bad?
You probably know I created my wealth through two things – learning how to treat myself like I mattered by paying myself first (A 5000-year-old concept of the wealthy.) and Investing in Real Estate.
While there are more details, those are the two primary drivers.
Owning apartment buildings makes me a housing provider – I don’t like the term landlord as that has some negative connotations.
My tenants and I have a contract with each other; it’s called the Lease Agreement. They honor their part, and I honor my part. They pay rent, and I provide excellent housing plus handle all repair requests.
Recently the city of Burbank, where we have 18 rental units, was considering adopting a rent control measure that the voters had already rejected two years earlier.
Now to the question in the subject line: Is rent control good or bad?
In my presentation to the Burbank mayor and city council members, I described my Google search results; I could not find any studies that said rent control was good.
Instead, thirty years of studies pointed to the following:
- An increase in the homeless population.
- The impact of gentrification displacing the poor and working class that it is supposed to help.
- The deterioration of the properties.
- A lack of new units being built creating housing shortages.
- An increase in bureaucracy.
- A decrease in mobility.
While many economists wrote about how rent control did not work to serve the intended population, my final comment to the council was a quote from Swedish economist Assar Lindbeck who declared that, “Rent control appears to be the most efficient technique presently known to destroy a city – except for bombing.”
Let me know if you agree or disagree.
To Your Prosperity,
Rennie
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