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Why Rent Control Doesn't Work

freakonomics.com

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Re: Why Rent Control Doesn't Work

#51

Post by scarface74 »

avs733 wrote: post #5

I lost respect for freakonomics and their analysis a while ago. What I used to find pointed and creative I now see as willfully ignoring elemebts of reality to come to some conclusion that is notable mostly for it's faux-contrarian 'creativity.' they, along with Malcolm Gladwell, some take a complex issue...use complexity to dismiss existing reductivist solutions...and then substitute their own equally reductivist co…

So do you have a specific example with research that you would like to cite that’s contrary to an episode?

Re: Why Rent Control Doesn't Work

#52

Post by scarface74 »

flukus wrote: post #20
irq11 wrote: post #2

This is a good discussion of rent control, even though the title is unfortunately click-baitey. The great thing about this episode is that it actually does something that most popular discussions of rent control don’t do: it acknowledges that it does work, for the rent controlled people. It also acknowledges that the harms of rent control are smaller, and spread across a large number of people (which is why rent cont…

> it does work, for the rent controlled people And anyone relying on their labor. If the cost of living goes up for those people then the cost of other things go up. It's in everyone's interest that cheap housing is available (by some means or other), but lately we've all been sacrificing for the literal rent seekers.

Or both businesses and employees could move to other parts of the country where it is cheaper.

Re: Why Rent Control Doesn't Work

#53

Post by esotericn »

rzwitserloot wrote: post #44
ukoki wrote: post #38

Earlier quoted context omitted.

How about just taxing the profits of house sales exorbitantly? Eg 70% tax on profits of house sales unless you are a UK resident and it's your only home. This way it's still worth buying housing with the intention of leasing it, but buying housing just to sit on it will be drastically less profitably.

There are 2 kinds of home owner. In the netherlands we have a saying: "Little house, little tree, little animal" (huisje, boompje, beestje). It means: Family life in a suburban home with a pet, a kid or two, a house with a garden, a car on the porch, a stable job, and the home is yours, you're paying off your mortgage, and you'll grow old with a nice nest egg in the form of having built up actual ownership, convertin…

Your final sentence seems to assume that the youth don't want what you're calling a "HBB" life.

They may not be able to achieve it, but if anything, I'd think that they're more likely to vote in favour of it.

I'm young. Effectively since high school I've been working towards that life. It's what I consider to be a good, successful life. Relaxing in front of the fire or kicking about in the garden with the kids.

In the UK we don't have the American exurb life for the most part, but a little terraced house with a garden on a quiet street - sign me up.

There is nothing impossible about this unless you expect that an infinite number of people should pile into one city regardless of economic viability.

Re: Why Rent Control Doesn't Work

#54

Post by bradleyjg »

As a resident of NYC I’m all for getting rid of rent control (stabilization) but I have to say that it leaves a sour taste in my mouth to just hand over a windfall to landlords that bought buildings while rent control was in place and accordingly paid a lower price.

Maybe some kind of rent control buyout program would make more sense.

Re: Why Rent Control Doesn't Work

#55

Post by MsMowz »

esotericn wrote: post #46

The idea of renting a property as a long-term solution to remaining on a specific plot of land fundamentally makes no sense. A five or ten year fixed lease, if you can negotiate one, might. It's completely unsurprising that on a year-by-year lease the rent might rise and you may want to move out. That's what a 1 year lease _is_. All of the emotional pandering surrounding that is simply unnecessary. If you want to liv…

That's not a popular opinion because it's functionally the same as saying only the people who can afford to buy a home or enter a long-term lease should have access to affordable, stable housing. Since politics is about who gets what, and since most people don't have much in terms of savings or leverage, it's in the interest of most people to oppose your viewpoint because it's against their interests.

It's only emotional pandering if you don't think politics should be a useful instrument to people without money.

Re: Why Rent Control Doesn't Work

#56

Post by flukus »

scarface74 wrote: post #52
flukus wrote: post #20

Earlier quoted context omitted.

> it does work, for the rent controlled people And anyone relying on their labor. If the cost of living goes up for those people then the cost of other things go up. It's in everyone's interest that cheap housing is available (by some means or other), but lately we've all been sacrificing for the literal rent seekers.

Or both businesses and employees could move to other parts of the country where it is cheaper.

An leave everyone else without local goods and services? It would make sense for software shops to move, but the grocery store and the people stacking it's shelves need to be where the population is.

Re: Why Rent Control Doesn't Work

#57

Post by enoch_r »

jplayer01 wrote: post #48
JamesBarney wrote: post #37

Earlier quoted context omitted.

This is just a description of a normal Monopoly which I think is pretty rare in housing because I never hear about it.

Don't need a monopoly if owners collectively behave this way, and they largely do (as we see in places like London or Berlin) because it ensures rising rent and thus increasing profit and property value.

This is a pretty classic prisoner's dilemma. Anyone who defects earns $3k more a month and has no appreciable affect on the rent for any other units they may own. Unless landlords are very unusually scrupulous, the resulting equilibrium won't look like a monopoly.

Re: Why Rent Control Doesn't Work

#58

Post by brianwawok »

bradleyjg wrote: post #54

As a resident of NYC I’m all for getting rid of rent control (stabilization) but I have to say that it leaves a sour taste in my mouth to just hand over a windfall to landlords that bought buildings while rent control was in place and accordingly paid a lower price. Maybe some kind of rent control buyout program would make more sense.

What happened to all the landlords who owned a building when rent controlled was first introduced? Most got stuck with a huge future loss.

Seems weird to subsidize one side but not the other.

Re: Why Rent Control Doesn't Work

#59

Post by bradleyjg »

brianwawok wrote: post #58
bradleyjg wrote: post #54

As a resident of NYC I’m all for getting rid of rent control (stabilization) but I have to say that it leaves a sour taste in my mouth to just hand over a windfall to landlords that bought buildings while rent control was in place and accordingly paid a lower price. Maybe some kind of rent control buyout program would make more sense.

What happened to all the landlords who owned a building when rent controlled was first introduced? Most got stuck with a huge future loss. Seems weird to subsidize one side but not the other.

They are long dead. How does it make any sense to give a windfall to a group of owners far removed in time and ownership to “balance” that?

Re: Why Rent Control Doesn't Work

#60

Post by esotericn »

MsMowz wrote: post #55
esotericn wrote: post #46

The idea of renting a property as a long-term solution to remaining on a specific plot of land fundamentally makes no sense. A five or ten year fixed lease, if you can negotiate one, might. It's completely unsurprising that on a year-by-year lease the rent might rise and you may want to move out. That's what a 1 year lease _is_. All of the emotional pandering surrounding that is simply unnecessary. If you want to liv…

That's not a popular opinion because it's functionally the same as saying only the people who can afford to buy a home or enter a long-term lease should have access to affordable, stable housing. Since politics is about who gets what, and since most people don't have much in terms of savings or leverage, it's in the interest of most people to oppose your viewpoint because it's against their interests. It's only emoti…

Yes, only people who can afford to enter into a long term lease have access to stable housing.

There is no "should" here. It's definitional. That's literally what a long lease is, as opposed to a short lease.

> It's only emotional pandering if you don't think politics should be a useful instrument to people without money.

It's emotional pandering because it's devoid of actual logic.

You've injected the 'people without money' bit here as if it's relevant when actually this is a matter that affects everyone.

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