Rent controls reduce rental supply, drive up rates, and lower housing quality

Rent controls drive landlords out of the market, leading to a scarcity of private rental properties and an increase in rates in non-controlled areas.

Research highlights negative impacts of rent controls on housing markets

Research published last week by the UK Institute of Economic Affairs backs up these assertions. The think tank had the economist Konstantin Kholodolin analyze 196 studies that evaluated the impact of rent controls in numerous countries. Kholodolin found that while rent controls did result in lower rents, they were accompanied by a slew of other unintended consequences, including poorer housing quality within the controlled rental sector, rent increases for those living in uncontrolled areas, and an overall reduction in housing supply and construction.

In short, critics of rent controls can draw upon plenty of real-world examples to justify their stance. In Argentina, President Javier Milei’s repeal of rent controls at the end of last year has resulted in a 195 percent increase in rental housing availability in Buenos Aires, alongside a drop in rental prices.