The Spokesman-Review reports that rent control is on the minds of some local leaders.
On Tuesday, new rent control regulations were passed in New York. Rent control has been illegal in Washington since 1981, but with the increasing issue of low vacancies and growing homelessness problem, not all local leaders think it should be kept out of the Spokane housing conversation.
“First, let me just say that fortunately Spokane is not New York or New York City,” Rep. Timm Ormsby, D-Spokane, said. “They’ve got challenges that I am thankful that we do not have.”
With that said, Spokane does have a housing issue, Ormsby said, and this is why he co-sponsored bills in the 2017-18 legislative session that would allow cities to make their own determinations about rent control.
Earlier this year, Oregon became the first state in the nation to adopt a statewide rent control law.
The law caps annual rent increases to 7 percent plus inflation throughout the state, which amounts to a limit of just over 10 percent this year. Annual increases in the Consumer Price Index, a measure of inflation, for Western states has ranged from just under 1 percent to 3.6 percent over the past five years.
The rent increase restrictions exempt new construction for 15 years, and landlords may raise rent without any cap if renters leave of their own accord. Subsidized rent also is exempt.
The bill also requires most landlords to cite a cause, such as failure to pay rent or other lease violation, when evicting renters after the first year of tenancy.
At the time, we pointed out that California voters wisely rejected rent control and that legislative efforts here to repeal the ban on rent control died in committee. As the Washington Research Council has written, there are better ways to handle the problem.
New voices calling for increased government intervention in many sectors of the economy have added the quick fix of rent control as their solution to the growing problem of housing affordability. But rent control is a Band-Aid, not a solution. If the affordability problem is to be solved the increase in demand must be met by an increase in supply. As rent controls would discourage the construction of new rental housing, they would make the affordability problem worse in the longer term.
Policymakers, taking heed to the vast majority of economists and the basic nature of market behavior, have resisted the call for rent controls. They would be wise to look to policies that would remove unnecessary regulatory impediments to an increase in the supply of housing, to counter balance the demand pressures driving up rents and property values.
Right. On this issue, the research is clear. Rent control solves nothing, though it does create new problems.