The Redistribution of Housing Wealth Caused by Rent Control [pdf]

> This paper studies the effects of rent control on the housing wealth of renters, landlords, and homeowners. Over the nine months following the passage of rent control in St. Paul, Minnesota in 2021, average property values fell by 4.4% to 5.8%.

This seems like too short-term a study. The argument against artificially holding prices down is that people won't produce as much as they would otherwise and people won't be able to get the thing they would otherwise buy. So what we're predicting a rent control policy will do is cause a shortage of rental accommodation in the area.

Now how that expresses itself in an accounting sense, who knows (probably the economists). Good question to study. But I doubt the impacts of rent control would appear in the market this quickly, it'd take years for the market signals to be measurable. Initially rent controls will probably be set near the previously ideal market price, I'd guess there are a lot of 12 month leases and housing construction projects probably don't reset that quickly either.

People like to look at rent control from a purely economic lens, but the sociopolitical aspect must also be considered. A suboptimal economic outcome might actually be optimal when all factors are considered. Social harmony and a feeling of hope for underprivileged residents are hard to value, but we must admit that they do have value.

Instead of repeating myself, here's the link:

https://news.ycombinator.com/item?id=48524204

Don't use Twin Cities property values in the early 2020s to draw conclusions about anything related to policy or economics. What you're actually measuring is the after shock of race riots.

Also, RHAWA is a landlord lobbying group.

One effect of rent-control that I have observed in San Francisco is that well-off people get into baller apartments with the intention of keeping them forever. Over time the rental rate gets inflated away to almost nothing, the person buys a mansion in suburbia, keeping their rent controlled penthouse as a pied-a-terre. In theory landlords would be looking to petition for eviction but that's usually not what happens.

When Boston ended rent control in the late 90s, all of the sudden the landlords invested in their goldmine buildings and generally improved the city. It sucks for those trying to rent or buy (including me, I paid 60% more for a house in 2002 than what it was worth in 1996), but the city has certainly had a renaissance.

IMHO, the problem now is bad zoning. The rich car-centric suburbs are preventing denser housing- to their own financial detriment. A recent fight is that the state has forced them to allow higher density housing around commuter rail stops. Similar fights about rail trails, future abutters are afraid of change but they are valuable everywhere they exist- in that they are a desirable feature and raise your house's value.

Another problem is that they overbuilt $100/sqft bio-lab space. These are sitting empty, and the owners refuse to lower the rent.. I don't understand how the owners remain solvent.

Important context: This paper is from 2023. In 2025, St. Paul massively rolled back rent control restrictions.

Their rent control used to have no exemptions, but now it's become very similar to SF rent control. Strict limit on how much rent can go up for current tenants, but can reset close to market rate when there's a 'just cause' vacancy. And all buildings built after X date are exempt entirely. (X=2004 in St. Paul, X=1979 in SF). Developers argued that any rent control at all limited their ability to finance housing projects.

I think results of studies like this were hugely influential to the changes in rent control that followed.

Without injection of new housing stock by the state, by coops or other agencies than BTR capital investors, it's highly likely to be a weaponised outcome to prove rent controls don't work.

If the construction strike by commercial investors is replaced by public housing then the better outcome can emerge.

This seems like a lot of work looking at mostly housing prices during peak covid which is hardly a generalizable situation.