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 number of available units. This inevitably forces prices to skyrocket in non-controlled buildings and leaves hopeful renters fighting over rent-controlled units. In places like New York City, people even leave their rent-controlled apartments to family members in their wills.
It is often the wealthy who hoard the rent-controlled properties. A select few benefit from rent control— while the rest of the city pays the price.
There are other negative impacts as well. Landlords who own units in rent-controlled buildings no longer have an incentive to renovate and maintain them. There is no reason for an owner to spend money on improvements when they are prevented from earning anything additional in return. Eventually what this means is those in rent-controlled apartments receive poor treatment.
In rent control, we observe a common failure that plagues big government policies: leaders are seeking to treat the symptom of the problem instead of the root cause. The famed economist Frederic Bastiat described this fallacious thinking as a focus on “what is seen” at the expense of what is “unseen.” Politicians “see” the select few tenants who get to keep their housing and have it been more affordable. What goes “unseen” is all the housing that never gets built because of the rent control.
If policymakers truly want to make housing more affordable, they could roll back the expensive regulations restricting construction that limit the supply of housing and cause high prices to begin with. More than enough cities and states have given rent control a try and paid the price when it failed. Californians were wise to learn from the failures of other states on this issue.
The author, Hannah Cox, is a libertarian-conservative writer, commentator, and activist. She’s a Newsmax Insider and a Contributor to The Washington Examiner. This article has been reprinted with permission of the author. This article was first published by the Foundation for Economic Education (FEE), and educational foundation dedicated to inspiring tomorrow’s leaders with sound economic principles and the entrepreneurial spirit with free online courses, top-rated in-person seminars, free books for classrooms, as well as relevant and worldly daily online content. For more information, go to: https://fee.org/.
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