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Yeah, so it actively incentivizes neglecting maintenance duties and driving out the current tenants rather than offering them to renew their lease at the market

Yeah, so it actively incentivizes neglecting maintenance duties and driving out the current tenants rather than offering them to renew their lease at the market rate. Sounds like a terrible law.

kelnos 6y ago
That's the downside of rent control. Rent ends up being stable and predictable for tenants, but it reduces the landlord's incentive to fix thing when they break and to make improvements (though many rent control laws, including SF's, still allow landlords to pass some of the cost of capital improvements to renters). Even when rent control continues to be active, landlords have an incentive to want to get their tenants out, because (at least in SF), a new tenant can be charged market rate when they move in (and then that rate is locked in with limited yearly increases until they leave). When rent control in Berkeley ended, but existing tenants grandfathered in, the landlords were incentivized even more than usual to do things to make a tenant want to leave, since then they'd have a completely non-rent-controlled unit again. It's not only bad behavior on the landlords' side. Tenants are incentivized to hold onto the unit as long as possible, even if they want or need to move out for a while. They'll often illegally sublet the place and hope the landlord doesn't come by to check on them until after they move back in. But they're also in some ways trapped: they may want to move, but know that they'll face a huge rent increase in their new place, so they stay put. Honestly I can't really blame landlords or tenants for their bad behavior under rent control; the rules around it only tend to provide one good outcome: rent stable and increases are predictable. Other outcomes are usually negative, and that's an inherent property of the system. But that one good outcome is often good enough to justify keeping rent control around.
- cycomanic 6y ago
  That that has anything to do with rent control is an absolute myth. Two counter examples are Sydney and Melbourne, both don't have rent control, Australia has big incentives for investing in housing (tax reductions if you don't live in the house). Both cities have seen an explosion of rents (10% year on year is not uncommon) and a building boom of cheap apartments that are only rented out via Airbnb. I can tell from experience that landlords do the absolute minimum they are legally required (mostly even less) and tenants are afraid to complain because they need the references when moving.

Yeah, so it actively incentivizes neglecting maintenance duties and driving out the current tenants rather than offering them to renew their lease at the market rate. Sounds like a terrible law.

kelnos 6y ago

That's the downside of rent control. Rent ends up being stable and predictable for tenants, but it reduces the landlord's incentive to fix thing when they break and to make improvements (though many rent control laws, including SF's, still allow landlords to pass some of the cost of capital improvements to renters). Even when rent control continues to be active, landlords have an incentive to want to get their tenants out, because (at least in SF), a new tenant can be charged market rate when they move in (and then that rate is locked in with limited yearly increases until they leave). When rent control in Berkeley ended, but existing tenants grandfathered in, the landlords were incentivized even more than usual to do things to make a tenant want to leave, since then they'd have a completely non-rent-controlled unit again. It's not only bad behavior on the landlords' side. Tenants are incentivized to hold onto the unit as long as possible, even if they want or need to move out for a while. They'll often illegally sublet the place and hope the landlord doesn't come by to check on them until after they move back in. But they're also in some ways trapped: they may want to move, but know that they'll face a huge rent increase in their new place, so they stay put. Honestly I can't really blame landlords or tenants for their bad behavior under rent control; the rules around it only tend to provide one good outcome: rent stable and increases are predictable. Other outcomes are usually negative, and that's an inherent property of the system. But that one good outcome is often good enough to justify keeping rent control around.

cycomanic 6y ago
That that has anything to do with rent control is an absolute myth. Two counter examples are Sydney and Melbourne, both don't have rent control, Australia has big incentives for investing in housing (tax reductions if you don't live in the house). Both cities have seen an explosion of rents (10% year on year is not uncommon) and a building boom of cheap apartments that are only rented out via Airbnb. I can tell from experience that landlords do the absolute minimum they are legally required (mostly even less) and tenants are afraid to complain because they need the references when moving.