Opinion: It’s a Myth that Top Economists Don’t Support Rent Control

New apartments in downtown San Diego. Photo by Chris Stone

Once again, the National Multifamily Housing Council is pushing outdated, obsolete ideas to protect the obscene profits of the country’s largest corporate landlords.

Let’s be clear: The NMHC is essentially the nationwide lobbying firm for corporate landlords who obviously have a strong incentive to oppose rent control. Their sole mission is to protect their ability to charge outrageous rents which are fueling the housing affordability and homelessness crises in California and across the country. Any “research” from real estate industry insiders, like the NMHC’s most recent industry-funded study, should not be trusted.

What should be trusted is economic consensus. Recently, a group of 32 top economists wrote a letter to the Biden administration saying that rent control is an effective tool to protect the poor and middle and working class. The economists also said that the real estate industry’s anti-rent control arguments are archaic and wrong. This is a major development in the rent control debate.

For too long, corporate landlords, landlord lobbying groups, and even reporters have pushed the myth that economists don’t support rent regulations. Now, 32 economists from such top universities as the Massachusetts Institute of Technology, UC Santa Barbara, American University, John Jay College, Columbia University, Bard College, and the University of Massachusetts very clearly are dismantling that assertion.

The economists note in their letter that, over the last few years, “We have seen the devastating impact of a poorly regulated housing market on people’s livelihoods, as already unaffordable rental prices outpace wage growth.”

They state that “high rents and a lack of tenant protections negatively impact tenants and their families, as well as the larger economy. At the household level, high rents lead to housing insecurity, homelessness, health challenges, and economic precarity for already-struggling renters.” They go on: “At the regional level, as rents rise, tenants with lower paying jobs are displaced and cannot live within commuting distances of employment, which hurts economic growth and perpetuates job dislocation.”

What can help? Rent control, rent control, and more rent control. The economists note that rent regulations will “protect tenants, stabilize neighborhoods, promote income diversity in regional economies, and improve the long-term outlook for housing affordability.”

To oppose rent control, at least for Big Real Estate’s selfish reasons, is just plain wrong. The economists emphasize that “substantial empirical evidence” shows that “rent regulation policies do not limit new construction, nor overall supply of housing.”

These are major findings that expose the real estate industry’s habit of making anti-rent control claims based on outdated or inaccurate studies. This often-quoted Stanford study about rent control, for instance, is misleading and seriously flawed. The use of rent control to protect tenants against predatory landlords is a time-honored tradition in the United States — it is as American as apple pie.

The economists’ pro-rent control findings are backed up by key studies published by the University of Southern California, UCLA, and UC Berkeley which found that rent control is a valuable tool to stabilize the housing affordability crisis and to prevent people from falling into homelessness. In the end, the 32 economists and the researchers at USC, UCLA, and UC Berkeley are saying the same thing: Rent control works.

n California, the situation is dire. The affordable housing and homelessness crises are worse than ever before, so the system is clearly broken. Accepting the status quo and refusing to act is a disservice to the millions of people who are struggling to get by in California, and rent control is one clear solution to the problem.

Why not try rent control? What do we have to lose? As America’s top economists put it, Californians have lost enough, and defeat does not have to be our status quo. Let’s score a win against Big Real Estate.

Patrick Range McDonald is the award-winning advocacy journalist for California-based Housing Is A Human Right.