Rent caps, which set limits on permissible rent charges or cap annual rent increases during tenancies, have been adopted by many cities as a way of curbing rising rents. But do rent caps actually work? Do they keep city rents affordable? Or are they part of the problem?
Yes, rent caps are a good idea
Rent caps keep rents affordable and prevent displacement.
Rent caps keep rent affordable
Rent caps ensure that rents do not increase at a higher rate than wages, elevating everyone's quality of life.
Rent caps fail at their basic function of keeping rents affordable.
Rent caps reduce the number of properties available to rent
Lower returns of investment de-incentivize letting and prompt many landlords to sell their properties for market value rather than accept rent below market value.
Rent caps incentivize the construction of new builds to avoid limits, leading to more properties being demolished to make way for swanky new rental properties.
Rent caps encourage renters to move into housing not suited for them
Rent caps lead to families holding onto properties that are smaller than they need because of a cheaper price. For single individuals, when family members move out, this leaves them with higher-priced large-style housing.
Without additional legislation, rent caps are irrelevant.
Rent caps are irrelevant without eviction protection for tenants
Without eviction protections, rent caps are useless. Landlords can circumvent the rent cap by raising the price to the rent cap's limit. Then, they can simply evict the current renter and replace them with a higher-paying tenant.
