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> it actually does nothing - it results in rents which are equal to what the open market price would have been.

Lots of people living in rent-controlled apartments around the world would disagree.



With your pithy reply you miss the critical fact that the german version of rent control isn't actually rent control. It just pegs how much rent for any given apartment can increase to how much the rent in that area has recently increased. In practice this means that all rents increase at the same rate as before the "control" was put in place.


And it screws over anyone who wasn’t lucky enough to win that lottery.


The lottery of having already lived there? Only in the same sense as if I have a doll, you're screwed out of having that doll.


Rent control diminishes the incentive to make new housing, and causes rents on remaining housing stock to rise, generally. It privileges the people who have held onto their apartments for a long time at the expense of everyone who has had to move recently, at least as it’s been implemented in American cities.

Doll ownership isn’t a great analogy for housing.


It also nails the feet of the people who live there to the floor, because they know they can't get such a deal again if they move.

This is economically and environmentally inefficient, because it traps people in less desirable jobs due to proximity, and prevents them from moving closer to work.


Ah yeah, another huge problem that I forgot to mention. This really kills the liquidity of the market. You see the same dynamic with sales in CA due to Prop 13 - this makes it so that elderly people can’t afford to downsize, because their property taxes would go up 10-20x for many of them if they moved to an equivalent place, and it’s economical for people to sit on extremely valuable undeveloped land and wait for it to appreciate, because there’s next to no holding cost.


If there weren't for things like rent control or prop 13 those people would just be suffering anyway as rents or property values would increase where they live as well. So I don't see that argument making much sense. Thing like prop 13 is probably damaging because it inflates property values however.


Have you ever noticed the odd fact that children sometimes grow up and wish to rent a home themselves?

They already might live there with their parents, but if they want to move out and stand on their own feet, they would have to pay double or triple compared to their neighbours. Hence they can not move out from mum's basement if they don't want to move away.

Of course this helps resident retirees who don't move and whose children have moved out, even if it is an economically retarded policy -- and retirees vote. Same as California's prop 13, really.




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