How rent controls have failed around world

[LMuhlen]

I see how it could be bad, simple supply and demand should have great impact in a wide market such as rent, and hiding the supply deficit behind a forced price sounds like treating a symptom and not a cause.

But when they say that only 4% of the expansion projects was cancelled, which could be for any number of reasons, I get some doubts regarding how damaging it is for the market. It could be one of those diseases where the symptoms alone create so much trouble that hiding them is already a massive benefit, preventing numerous other issues from sprouting.

I think the whole issue needs to be addressed from multiple angles, no one solution will be enough.

[PhantasmagoriaX]

A real easy solution to the issues. Move somewhere fucking else!

Seriously all these free spirits and assholes that hate everyone else love to fucking live where everyone else lives. If you're so independent move to fucking Wyoming JFC.

Omfg rent is so high where everyone else is. Shocking

Oh yeah cause thats so easy!


I personally love to see some rent control (like a limit to what a landlord can increase per year) rent in my area is stupid expensive too

[Dundebuns]

There's an issue with building lots of new properties though, as people (especially in the UK) who already own property snatch up the new builds with aim to then let them out. It's getting increasingly more difficult to get on the property ladder, and until the housing bubble bursts, it's only going to get more difficult. Flooding the market with new homes however, with restrictions that favour new buyers over people who already own property will help though.

JC isn't wrong that there needs to be some controls, but probably nothing as extreme as 'You can only charge £x a month for this property'

[Aquinan]

Rent controls don't work.

I'd disagree with you there, certain places it does. Where I live there is a housing authority, with waitlist for renting / owning property. You must be a resident/citizen of Canada, and you have to live in the property - no AirBnB, living out of town using it as a holiday home etc. The price of renting is controlled and the prices of buying the homes is. Rent price is reasonable per month compared to what the free market prices are, some of which are absurd.

[Thagrynor]

A lot of developers work within a single city. They can't just up and move, particularly since they already have a niche in their current metropolis, but would have to try and establish one in a city that's already packed with developers of its own.

Plus, low-income housing still turns a profit. And the the city, they don't really care if one developer won't take up the option. There's a lot of developers, and whoever takes it will still manage a profit off the project, so it's a matter of time. Especially when you aren't giving anyone much alternative.

Your argument here is completely unrealistic, and requires a development company to throw a hissy fit and give up their entire business to try and rebuild elsewhere, at great expense and risk, all because they might make somewhat less profit than they could have on a project they're trying to get off the ground. It's nonsense.

My point also has the advantage of being actual standard operating practice in most cities. So it's not like I'm hypothesizing some impossible goal; this is already how city planning functions.

Except you forgot one huge factor: developers CAN just as easily build into suburbs or switch to commercial where there is nearly guaranteed profit. The fact remains that forcing a developer into something doesn't mean it will get done. Yes, some developers will bend to it, but others will refuse. In Chicago, it really is not that difficult to move just outside of the city and find plenty of opportunity for development without that much commute. And given that suburbs would not be forced to bow to the restrictions of whatever metropolis they are near, the developer could very easily move, without having to pick up much of anything.

I know a number of people in real estate development and most have turned down projects because of how absolutely restrictive certain places are to build, including what would have been huge luxury high rises because of how the locality attempted to force them to build low income as well. You seem to think developers build buildings for the fun of it or as a charity. Developers are in the market to make money. If Option A and Option B both require within 5-10% of the same amount of work, but Option A nets 200% of the revenue as Option B, why would you think a developer would be just as happy with Option A as Option B?

[Molis]

They have to work with real people to get stuff done. You can be a genius, but if everyone around you is an idiot, nothing of note is going to be accomplished.

I love Sim City. Everyone in that game does exactly what they are told.

Except when you would leave the console on overnight and either you would be a billionaire or they would burn your city to the ground.

[Glorious Leader]

You want to kill commodity futures?

Yes or at least implement position limits. Especially with respect to food. In so far as housing is concerned the idea that people can use housing as a vehicle to invest capital in is the reason were in this mess. Plenty of housing but the supply is eaten up. In vancouver and toronto this is primarily done by foreign speculators who want a safe place to store capital. They dont even live here ffs.

[Endus]

Except you forgot one huge factor: developers CAN just as easily build into suburbs or switch to commercial where there is nearly guaranteed profit.

I'm not forgetting anything. They're dealing with the same city codes either way, and the planners have the same capacity to add an "okay, but only if you also build X" rider to things as in any other case.

[Tinykong]

I feel bad for the next generation.

When I was 18 years old, my first apartment that I shared with 3 friends was $700 a month, and it was nice. I made $8/hr, and I thought we lived like kings.

A one room (not one bedroom, literally one room) apartment in that same town is now $900 a month. The apartment complex that I first rented from is still there, and they are $1750 a month, and are pretty much at capacity.

I won't be surprised if in 10 years those apartments are $3000 a month.

[nanook12]

Honestly, I don't even care if they don't work like they are supposed to. Rent controls should be implemented and landlords can fuck themselves. They are greed filled bastards that inherited everything.

[Total Crica]

Honestly, I don't even care if they don't work like they are supposed to. Rent controls should be implemented and landlords can fuck themselves. They are greed filled bastards that inherited everything.

No, not everyone inherited what they own. We purchased what we own after saving enough money from working to do so. No, not all landlords are greedy. But they are the ones responsible for fixing anything that goes wrong at the property. So they have to charge enough to cover anything that could happen. And why should landlords fix anything that goes wrong at the property for free? Do you work for free? As for mortgages, the rent MUST cover that payment and any insurance and a pool of savings for emergencies. Because alot of landlords have to pay for what you are renting as well.

[Tiwack]

I'm hoping for... can't remember the word, but they're basically high rises, with miniature self contained town-style areas with shops and such every 10-15 floors. and that's going to annoy me until I can remember the word.

Mega-blocks/towers? Same as you see in a couple sci-fis

[Mormolyce]

No, I (she) just meant owned by specific humans, regardless of private or not.

That's a nonsensical sentence.

[Thagrynor]

I'm not forgetting anything. They're dealing with the same city codes either way, and the planners have the same capacity to add an "okay, but only if you also build X" rider to things as in any other case.

Do you understand how city limits work? See, when a city defines an ordinance, it ONLY applies to that city. The neighboring city does not have to abide by that ordinance unless they choose to. Much like how independent nations laws stop at their borders, so too do city limits stop city ordinances. That means that, no, they are not necessarily dealing with "the same city codes either way". And yes, those suburbs have the right to pass a similar ordinance, but in light of them NOT doing so, a developer is free to move to the neighboring town and build there instead, with less restriction.

So, you are right, you didn't forget it. You just seem to not even understand the basics of local government. My apologies.

[XDurionX]

Yeah it's pretty retarded to limit rent by laws. You limit rent by providing enough room for everyone.

[PLS]

Whats retarded is that of my 4 friends in the construction industry, 2 of which work for the largest plumbing company in the country, all of them are paid overtime in cash. They buy material in cash, they repair tools in cash etc. One company we work for supplies 37% of the paving industries aggregate, the employees openly joke about cutting the aggregate with shit fill and the how all the inspectors for the city are on the take. Everyone literally everyone openly jokes about how stupidly lucrative government contracts are mainly because they meet up once a year to collude on upcoming bids. I personally know that the individual in charge of awarding moveing contracts for the federal government in my area takes cash to award contracts. I have reported it , and there is simply a lack of enforcement.

All this focus on rent control and other "issues" when the biggest factor BY FAR is the blind eye we turn to the fact that this core industry openly avoids taxes and takes advantage of public funds. If we spent a fraction of our time and money on oversight and enforcement of white collar crime we would see an exponential return.

People want "hands off" policies but, then when an unsustainable industry begins to falter because of unregulated capitalism they turn around and cry bloody murder, and that "we can't let them fail "think of the jobs" all the reward and no risk in a risk=reward system.

[Endus]

Do you understand how city limits work? See, when a city defines an ordinance, it ONLY applies to that city. The neighboring city does not have to abide by that ordinance unless they choose to. Much like how independent nations laws stop at their borders, so too do city limits stop city ordinances. That means that, no, they are not necessarily dealing with "the same city codes either way". And yes, those suburbs have the right to pass a similar ordinance, but in light of them NOT doing so, a developer is free to move to the neighboring town and build there instead, with less restriction.

So, you are right, you didn't forget it. You just seem to not even understand the basics of local government. My apologies.

Suburbs are largely part of that same city. Hence "suburb", rather than "satellite city".

And even where there is a satellite city, there's still a development opportunity that this particular developer is walking away from. That opportunity is open to any other developer who's willing to build under those terms, terms which were still profitable to the developer who took them. This isn't a battle between the city and one developer. This is a negotiation between the city and many developers, and one developer throwing a hissy fit because they won't get their way doesn't mean another isn't perfectly happy to play ball, since the city's got justifiable needs and reasons for their policies, and not all developers focus exclusively on profit and ignore basic ethical practice. Which is what our hypothetical hissy-fit-throwing developer is doing.

[A dot Ham]

Rents balloon out of control largely due to insufficient supply. The simple answer to that is to stop letting your city planning department rubber-stamp all development permits, and instead start enforcing conditions to create the development the city needs, rather than what the developer would find most profitable.

The great lie of our time. Granted things may be different in Canada.

But the housing shortages and inflated prices in the U.S. are completely fabricated. A cursory glance at the issues in the UK brings me to a similar conclusion.

[nanook12]

No, not everyone inherited what they own. We purchased what we own after saving enough money from working to do so. No, not all landlords are greedy. But they are the ones responsible for fixing anything that goes wrong at the property. So they have to charge enough to cover anything that could happen. And why should landlords fix anything that goes wrong at the property for free? Do you work for free? As for mortgages, the rent MUST cover that payment and any insurance and a pool of savings for emergencies. Because alot of landlords have to pay for what you are renting as well.

So? Maybe I didn't make it clear. I want to impose rent control simply out of spite because I dislike richie landlords.

[Thagrynor]

Suburbs are largely part of that same city. Hence "suburb", rather than "satellite city".

And even where there is a satellite city, there's still a development opportunity that this particular developer is walking away from. That opportunity is open to any other developer who's willing to build under those terms, terms which were still profitable to the developer who took them. This isn't a battle between the city and one developer. This is a negotiation between the city and many developers, and one developer throwing a hissy fit because they won't get their way doesn't mean another isn't perfectly happy to play ball, since the city's got justifiable needs and reasons for their policies, and not all developers focus exclusively on profit and ignore basic ethical practice. Which is what our hypothetical hissy-fit-throwing developer is doing.

Actually, they are not. Well, maybe in Canada suburbs are "largely part of the same city", but in the US, they are individual, autonomous cities. I live in a suburb of Chicago and we do not have to abide by Chicago city ordinances. There are a lot of suburbs that do not. I am not talking about satellite cities, nor am I talking about districts or neighborhoods within the city proper. I am talking actual suburbs of a city. Chicago city limits are where Chicago ordinances end. Chicago itself is not actually a very large city. When they talk about Chicago being large, they are referring to Chicago and the adjoining suburbs, which are all independent cities. Point in case as proof: My uncle, who is a Chicago fireman, is limited in where he can live because he needs to remain in Chicago city limits to hold his job. So, no, suburbs are not part of the same city, from a governmental stand point.

And yes, obviously another developer can move in and take over a contract or propose a plan. The point is, trying to hold someone hostage by forcing them to building something they had no intention of building is not a "Aha! I've got you now" solution, like you make it out to be. Developers can just as easily walk away when such demands are made. And, given the number of people who say that low income/affordable housing being scarce is the largest problem with living in a city, if cities were to start forcing projects like this on developers and turning down their larger projects they want to go after, the more the city does it, the fewer developers will continue along with it. Again, you need to add financial incentive (in whatever way that works out, I am not implying paying off the developer) to make it worth his time building those types of housing. And the sad reality is, the more and more and more low income housing you build, the more you make a metropolitan area undesirable to live in by those who can afford to move out of the city, which will eventually pull business out of the city and you end up with slums. There needs to be a balance to avoid over-gentrification and to avoid prosperity leaving because of rising crime rates, which are bound to accompany an influx of people, regardless of income (meaning that the people moving in could be the criminals or they could simply be the victims of crime, either of which is undesirable to live near).