Report: Rent control will make housing problems worse, not better

Minnesota should learn from California’s failed rent control policies that exacerbated housing shortages

Center of the American Experiment issued a timely report on the ineffectiveness of rent control policies as voters in St. Paul and Minneapolis prepare to vote on separate ballot measures in next Tuesday’s election. Evidence on Rent Control — It’s Ineffective and Harmful argues that recently enacted rent control policies in cities around the country have reduced the quantity and quality of housing supply, a potentially disastrous outcome for the Twin Cities.

According to the research, St. Paul’s proposed rent control proposal would be one of the strictest in the nation as it does not allow landlords to raise rents to market rates between tenants, it does not exempt new construction and it does not consider inflation. The rent control ballot question in Minneapolis only allows the city council to develop a policy that will have to be voted on again in a subsequent election.

“Rent control policies treat the symptom, not the root cause of high housing prices, which right now is a lack of supply,” said Martha Njolomole, author of the report and economist at Center of the American Experiment. “Everywhere rent control has been tried throughout history, it has failed.”

Well-meaning rent control policies that purport to help low-income renters will backfire as research shows landlords will cater to the higher end of the rental market and reduce their investments at the lower end of the market. The result will be the same in the Twin Cities as it has been in other cities: fewer low-income housing opportunities and steadily higher rents.

The full report can be found on American Experiment’s website at: