Rent control is a highly fascinating matter, especially in the Canadian market considering how we have different forms of rent control legislation for each province.
In my current capacity, I oversee assets both in the United States and within Canada, and this affords me the opportunity to learn (and study) the varied forms of rent control as well as the strategies and techniques required to improve the revenue of those assets which are subject to rent control guidelines. Today I’m going to shy away from getting too granular with the specifics of rent control legislations or revenue strategies utilised. I want to discuss one acute observation I’ve made over the years, and that is rent control does not work. As a public policy measure, it fails in the long term to protect the very individuals it aspires to help, this is my opinion formed over a decade of experience in the rental housing industry.
On the surface, rent control alleviates the issue of affordable housing, when you scratch the surface and look deeper, you will find that it eventually erodes the living conditions and affordability of the marketplace in the medium to long term. Furthermore, if you want to see the effects of rent control legislation, just look at any affordable housing project, they function as a ‘control group’ in a science experiment. To my fellow revenue manager’s and multi-res industry-insiders, I’m sure you’ve already observed this phenomenon.
There’s a video from Stanford University’s Hoover Institution that does a fantastic job of succinctly explaining why rent control as a public policy measure it is not a good solution, one that ultimately backfires.
For more information check our their website: https://www.policyed.org/intellections/no-vacancy/key-facts
The follow-up question likely now sitting on the tip of your tongue is “If rent control is not a solution, then what is?”. Well, that’s a discussion for another time, as plenty can be said on this topic.
Lastly, I always reserve the right to update my views as new information presents itself. Life is a journey, and we learn new things every day.