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> The 2020 Rental Law ... mandated three-year lease terms and required rent to be paid in pesos—a currency rapidly losing value due to rampant inflation. > Fac

> The 2020 Rental Law ... mandated three-year lease terms and required rent to be paid in pesos—a currency rapidly losing value due to rampant inflation. > Faced with inflation and rigid restrictions, landlords were hesitant to sign long-term leases. Many either set excessively high rents to hedge against future inflation or withdrew their properties from the rental market altogether. Others opted to sell in U.S. dollars or list them on short-term rental platforms like Airbnb, where they could charge in foreign currencies.

tivert 2y ago
So basically, the effects are mainly due to deficiencies with the previous law, and probably can't be generalized to rent control in general (though I'm sure many will try). For instance, I don't think I've ever heard of a rent control law that allowed setting "excessively high rents" to try to preemptively counter it. I think it's a lot more typical to take the current market prices and limit the rate of future increases.
- renewiltord 2y ago
  [flagged]
  - onemoresoop 2y ago
    Your use of communism here is a strawman to not talk about socialism. Socialist programs is what kept the world from going back to feudalism.
    - iphoneisbetter 2y ago
      [flagged]
  - deleted 2y ago
    [deleted]
  - tivert 2y ago
    > Real Communism hasn’t been tried. Once we do it, it’s going to work. Come on. You've said nothing of value and had no insight. No one's talking about full-on central planning. You've just uttered a strawman slogan for the unrestrained free market. But the unrestrained free market would objectively suck, which anyone with two brain cells who is not high on ideology can predict. It's most prefect expression, anarcho-capitalism, is the ununoctium of economic systems (as it would immediately decay into something very different).
    - jjk166 2y ago
      The comment was drawing a parallel - the same way people say "real communism hasn't been tried yet" the root comment is saying "real rent control hasn't been tried yet" and the complaints about the first statement apply to the second. It is not an argument for an unrestrained free market.
    - ptsneves 2y ago
      > You've said nothing of value and had no insight. No one's talking about full-on central planning. You've just uttered a strawman slogan for the unrestrained free market. The case in discussion is not a full-on central planning, just core socialist policies that often fail. It is legitimate to regard the excuses as just excuses. > But the unrestrained free market would objectively suck, which anyone with two brain cells who is not high on ideology can predict. This is not the case of the article, nor is suggested by the parent. The housing code or other technical regulations regarding housing have not been removed, thus jumping to ideologies and disparaging them is besides the point[1] and a fallacy. What was lifted was a very common policy solution for the housing problem and it happened that things improved in its absence. Wherever people have been victims of these policies it is natural people respond to supporters with these simple slogans. Those are 2 straw men there :D. [1] I recently went through the anarchist political movements of the 19th century and some believed the State is immoral because it is a manifestation of violent power. We live in times where people try to excuse the State's violence primacy with laws which are moral, and that is actually the worst. It reliefs them of the burden that is to take something from the other fellow men. Whenever somebody suggests regulating something about private property they should imagine a mobster coming for extortion money. Maybe the mobster is a really really good guy and we kind of can choose the mobster, but he is still a mobster. I find this moral weight important to keep us and the powers that be from being a bad mobster.
  - ptsneves 2y ago
    It is always an implementation issue and never a design issue. If a design leads to easy foot-guns then it is a bad design.
- whizzter 2y ago
  In Sweden, new contracts are arbitrary (new stock or people dying/leaving) so the market is at play then but yearly increases are limited in size (with the exception of "standard improving renovations" that are now being mis-used instead to drive out elders). In general it has had it's benefits for safety but you now also have 70-90 year olds that once had families that now are living alone in 120m2 4-5 room apartments that can't move to anything smaller (thus yielding space to a young family) because the rent in anything smaller would be larger than their current rent, so they stay and the housing usage gets skewed.
  - kevinak 2y ago
    This is not correct, new contracts are not arbitrary. They are determined by the "bruksvärdeshyra". (https://www.hyresgastforeningen.se/stod-och-rad/hyra/vad-ar-bruksvardeshyra/ https://www.hyresgastforeningen.se/stod-och-rad/hyra/vad-ar-...)
    - tivert 2y ago
      > bruksvärdeshyra Google is translating that as "utility value rent," and it appears to be something calculated by a committee based on the "value" from the tenant's point of view.
    - whizzter 2y ago
      Bruksvärdeshyra(utility value) is a tool by lawmakers to punt details away from actual laws, in practice rents become location based so central locations cost more (even if not always as much more as buying would cost). I checked the laws a bit, the utility value is only mentioned for "disagreements" and the comments explicitly mentions raises as the source for disagreements. Thus when signing an initial contract (as i mentioned) the landlord is free to set whatever they feel like since a tenant would have to agree to get the apartment. In practice (not by law) landlords are supposed to give a portion of their available stock to the common queue systems, those apartments seem to follow the utility value with some adjustment for location. However a few years back I was in a separation and since living in Stockholm also a bit desperate and looked at the private landlord queues, the prices were far higher and since I would agree to that initial pricing it would supercede the utility value. Needless to say, I quickly pivoted to buying since that's cheaper in the long run.
- NewJazz 2y ago
  I don't think I've ever heard of a rent control law that allowed setting "excessively high rents" to try to preemptively counter it. California rent stabilization doesn't have any stipulations about starting rent for new tenants, only increases for existing tenants. While I haven't seen it explicitly stated anywhere, I assume California landlords take into account the rent increase restrictions when deciding on what to ask for starting rent. They don't want to be caught in a situation with a 20% insurance increase and a max 8% rent increase, such that they are no longer cash flowing. So they'll add some buffer ahead of time.
- deleted 2y ago
  [deleted]
- daedrdev 2y ago
  They had inflation of 100%. The supply already cratered because of the law, if the preemptive counter was removed the supply would have cratered even more. The rise in price was due to deficiencies. The lack of supply was completely expected and would have been worse with a stronger law.
- toast0 2y ago
  > For instance, I don't think I've ever heard of a rent control law that allowed setting "excessively high rents" to try to preemptively counter it. I think it's a lot more typical to take the current market prices and limit the rate of future increases. Some rent control laws only apply to leases of individual tenants and don't apply between tenants. In those, as long as someone leaves 'normally', you can charge the next tenant whatever you like; although if everyone sets excessively high rents to counter rent control, exvessively high rents are the market rate. Other rent control laws do limit rents since the start of the law or sometimes a point in time before the law.
  - TZubiri 2y ago
    It's not that the law allowed excessively high rents. But makes no mention of price. How would you even enforce a law that prohibits "high" prices.
    - toast0 2y ago
      If you really want to prohibit high prices, you can set a cap on rent per area and enforce with auditing. More typically, you limit the amount of rent increases for new tenants, and have the original reference for rent be set before the law was brought up, so nobody had time to preemptively raise rent to cover rent control.
    - ricardobeat 2y ago
      > How would you even enforce a law that prohibits "high" prices In the Netherlands there is a points system. Every feature of a house like the number of bathrooms, windows, heating, etc contributes to the score. It's mostly used to define the social housing threshold: houses below a certain number of points are removed from the free market and have the rent fixed as a function of the score. For houses on the free market, you look at average price per sqm for the area. High rent is off the curve. You can also correlate to the baseline set by the points system, and rent as a proportion of average income to define 'high'.
- s1artibartfast 2y ago
  Im against rent control in general, but agree that there are material differences in implementation. For context, Argentina has had 50% inflation at the time rent control went into place, and inflation had increased to 250% in 2024. The rent control required 3 year contracts in Argentine currency only. In my opinion, this was essentially a speed run of the effects of other rent control laws which limit rent increases to rates below inflation.
- Ferret7446 2y ago
  The idea that you can come up with a perfect law is how centrally planned economies fail.

tivert 2y ago

So basically, the effects are mainly due to deficiencies with the previous law, and probably can't be generalized to rent control in general (though I'm sure many will try). For instance, I don't think I've ever heard of a rent control law that allowed setting "excessively high rents" to try to preemptively counter it. I think it's a lot more typical to take the current market prices and limit the rate of future increases.

renewiltord 2y ago
[flagged]
- onemoresoop 2y ago
  Your use of communism here is a strawman to not talk about socialism. Socialist programs is what kept the world from going back to feudalism.
  - iphoneisbetter 2y ago
    [flagged]
- deleted 2y ago
  [deleted]
- tivert 2y ago
  > Real Communism hasn’t been tried. Once we do it, it’s going to work. Come on. You've said nothing of value and had no insight. No one's talking about full-on central planning. You've just uttered a strawman slogan for the unrestrained free market. But the unrestrained free market would objectively suck, which anyone with two brain cells who is not high on ideology can predict. It's most prefect expression, anarcho-capitalism, is the ununoctium of economic systems (as it would immediately decay into something very different).
  - jjk166 2y ago
    The comment was drawing a parallel - the same way people say "real communism hasn't been tried yet" the root comment is saying "real rent control hasn't been tried yet" and the complaints about the first statement apply to the second. It is not an argument for an unrestrained free market.
  - ptsneves 2y ago
    > You've said nothing of value and had no insight. No one's talking about full-on central planning. You've just uttered a strawman slogan for the unrestrained free market. The case in discussion is not a full-on central planning, just core socialist policies that often fail. It is legitimate to regard the excuses as just excuses. > But the unrestrained free market would objectively suck, which anyone with two brain cells who is not high on ideology can predict. This is not the case of the article, nor is suggested by the parent. The housing code or other technical regulations regarding housing have not been removed, thus jumping to ideologies and disparaging them is besides the point[1] and a fallacy. What was lifted was a very common policy solution for the housing problem and it happened that things improved in its absence. Wherever people have been victims of these policies it is natural people respond to supporters with these simple slogans. Those are 2 straw men there :D. [1] I recently went through the anarchist political movements of the 19th century and some believed the State is immoral because it is a manifestation of violent power. We live in times where people try to excuse the State's violence primacy with laws which are moral, and that is actually the worst. It reliefs them of the burden that is to take something from the other fellow men. Whenever somebody suggests regulating something about private property they should imagine a mobster coming for extortion money. Maybe the mobster is a really really good guy and we kind of can choose the mobster, but he is still a mobster. I find this moral weight important to keep us and the powers that be from being a bad mobster.
- ptsneves 2y ago
  It is always an implementation issue and never a design issue. If a design leads to easy foot-guns then it is a bad design.
whizzter 2y ago
In Sweden, new contracts are arbitrary (new stock or people dying/leaving) so the market is at play then but yearly increases are limited in size (with the exception of "standard improving renovations" that are now being mis-used instead to drive out elders). In general it has had it's benefits for safety but you now also have 70-90 year olds that once had families that now are living alone in 120m2 4-5 room apartments that can't move to anything smaller (thus yielding space to a young family) because the rent in anything smaller would be larger than their current rent, so they stay and the housing usage gets skewed.
- kevinak 2y ago
  This is not correct, new contracts are not arbitrary. They are determined by the "bruksvärdeshyra". (https://www.hyresgastforeningen.se/stod-och-rad/hyra/vad-ar-bruksvardeshyra/ https://www.hyresgastforeningen.se/stod-och-rad/hyra/vad-ar-...)
  - tivert 2y ago
    > bruksvärdeshyra Google is translating that as "utility value rent," and it appears to be something calculated by a committee based on the "value" from the tenant's point of view.
  - whizzter 2y ago
    Bruksvärdeshyra(utility value) is a tool by lawmakers to punt details away from actual laws, in practice rents become location based so central locations cost more (even if not always as much more as buying would cost). I checked the laws a bit, the utility value is only mentioned for "disagreements" and the comments explicitly mentions raises as the source for disagreements. Thus when signing an initial contract (as i mentioned) the landlord is free to set whatever they feel like since a tenant would have to agree to get the apartment. In practice (not by law) landlords are supposed to give a portion of their available stock to the common queue systems, those apartments seem to follow the utility value with some adjustment for location. However a few years back I was in a separation and since living in Stockholm also a bit desperate and looked at the private landlord queues, the prices were far higher and since I would agree to that initial pricing it would supercede the utility value. Needless to say, I quickly pivoted to buying since that's cheaper in the long run.
NewJazz 2y ago
I don't think I've ever heard of a rent control law that allowed setting "excessively high rents" to try to preemptively counter it. California rent stabilization doesn't have any stipulations about starting rent for new tenants, only increases for existing tenants. While I haven't seen it explicitly stated anywhere, I assume California landlords take into account the rent increase restrictions when deciding on what to ask for starting rent. They don't want to be caught in a situation with a 20% insurance increase and a max 8% rent increase, such that they are no longer cash flowing. So they'll add some buffer ahead of time.
deleted 2y ago
[deleted]
daedrdev 2y ago
They had inflation of 100%. The supply already cratered because of the law, if the preemptive counter was removed the supply would have cratered even more. The rise in price was due to deficiencies. The lack of supply was completely expected and would have been worse with a stronger law.
toast0 2y ago
> For instance, I don't think I've ever heard of a rent control law that allowed setting "excessively high rents" to try to preemptively counter it. I think it's a lot more typical to take the current market prices and limit the rate of future increases. Some rent control laws only apply to leases of individual tenants and don't apply between tenants. In those, as long as someone leaves 'normally', you can charge the next tenant whatever you like; although if everyone sets excessively high rents to counter rent control, exvessively high rents are the market rate. Other rent control laws do limit rents since the start of the law or sometimes a point in time before the law.
- TZubiri 2y ago
  It's not that the law allowed excessively high rents. But makes no mention of price. How would you even enforce a law that prohibits "high" prices.
  - toast0 2y ago
    If you really want to prohibit high prices, you can set a cap on rent per area and enforce with auditing. More typically, you limit the amount of rent increases for new tenants, and have the original reference for rent be set before the law was brought up, so nobody had time to preemptively raise rent to cover rent control.
  - ricardobeat 2y ago
    > How would you even enforce a law that prohibits "high" prices In the Netherlands there is a points system. Every feature of a house like the number of bathrooms, windows, heating, etc contributes to the score. It's mostly used to define the social housing threshold: houses below a certain number of points are removed from the free market and have the rent fixed as a function of the score. For houses on the free market, you look at average price per sqm for the area. High rent is off the curve. You can also correlate to the baseline set by the points system, and rent as a proportion of average income to define 'high'.
s1artibartfast 2y ago
Im against rent control in general, but agree that there are material differences in implementation. For context, Argentina has had 50% inflation at the time rent control went into place, and inflation had increased to 250% in 2024. The rent control required 3 year contracts in Argentine currency only. In my opinion, this was essentially a speed run of the effects of other rent control laws which limit rent increases to rates below inflation.
Ferret7446 2y ago
The idea that you can come up with a perfect law is how centrally planned economies fail.