Rent Control

I have a friend and co-author and editor of many of this blog's pieces who wrote the following.  It was written to be spoken at a City Council meeting.  I believe it speaks for itself.

I’d like to talk about Rent Control.

But, first, you should know where I am coming from.

Many have labelled me a Socialist, but the reason is always that they are clueless about what the word means.  Like most thinking people on the planet, I favor an essentially capitalist economy with socialistic regulations, sensible regulations, just like Adam Smith the daddy of modern capitalism.  You say that Smith favored unregulated, laissez-faire capitalism?  He did not, but we can have that discussion when I am not limited to a few minutes of your time.

I believe that if I were a homeowner who wants to sell my home to a new buyer, I should have the right to price my home at any price I care to, with no limits whatever.  If I choose to ask $10 million for a home that is really worth $150,000, why can’t I?  If I do not find a buyer, the fault is my own for asking an unreasonable price.  If someone is willing to pay my price, why can’t I take it?  No good reason.  Any price where both the buyer and the seller agree should be a legal price, no exceptions (well, maybe fraud or collusion).  Similarly, if I own an apartment complex, and I want to ask $2500 for an apartment unit really worth only $1,000, why can’t I?  If I can find a renter, well, good for me!  If I can’t, that apartment unit will go un-rented until I get real and ask for what it is worth, perhaps no more than $1,000.

So, not only do I understand a capitalist’s desire to maximize his earnings, I am also OK with it.   Well, ...

But, if someone – a single person or a couple or a family – is already established in an apartment unit with a one-year lease – or a two-year lease, or a five-year lease – lease renewal is not at all the same thing as leasing a vacant apartment to a new tenant.  The notion that a landlord should have the same unrestrained flexibility to dictate the price for a lease renewal  ("to market value," of course) as for a new lease is just plain thoughtless.

I could talk for a half-hour discussing the differences, but I don’t have the time, and it is not necessary (what the heck: 1) searching for a new home costs time, a lot of time; 2) having a mover move my stuff costs money, often more than a full month's rent; 3) moving from one home to another is the second most stressful event in life after the death of a spouse, and it costs us in many intangible ways).  Who honestly believes that renting a home is more like renting a hotel room for a few days than it is like buying a home of one’s own?  Homeowners do not have to get anxious over annual increases in their mortgage payments.  Nor should renters have to get anxious every year over a possibly excessive rent increase.

I am a senior and I live within a “fixed income” called Social Security; I have no other source of income.  There are a half-dozen jobs worth good money that I could handle quite competently; but who is hiring a man of my age, notwithstanding that age discrimination is illegal (hah!)?  My landlord raised my rent by 5% last year.  I have no assurance that he will not do the same this year.  Or that he will raise it by more than 5%.  Or that he will raise it less than the increase in my Social Security check.  The average Social Security increase over the last ten years has been 1.36%, three years no increase at all.  As I already spend nearly 46% of my income on rent and utilities, how many more years of 5% rent increases before I pay over 50% of my income on rent?  Two years.  There goes that weekly doughnut!  Every year that a rent increase exceeds the (hoped-for) increase in Social Security is an increasing hardship on me.

What I am talking about is not really MY issue; nor is it a city or state issue; rather, it OUGHT to be a nation-wide issue.  But most states and cities have no form of rent control whatever; whereas all I am talking about is called "vacancy decontrol" aka "tenancy or second-generation rent control,” the least obtrusive of all forms of rent control - restricting the landlord's liberty to increase rent without restraint on an existing tenant.  Why is this not the law of the land?  For the same reason that Landlord-Tenant laws are always Landlord laws; for the same reason that wealthy people get the laws they want and the poor and middle-class do not (they don’t have the time to devote to political change or the authority to win the change they need).

What am I asking of my state government?  I don’t want to have to begin to be anxious in September (lease renewal is early December) looking for my next (cheaper) residence (in some other state?), just in case I am hit with another 5% (or 10%) rent increase (that I won’t know about until two months before I must renew or not).

But I am NOT asking for a special favor for myself.  My city has the power to do something valuable for its residents, most of its residents.

Thanks for listening.

Addendum: Monday, 06/12/2023

This just in!  In Boston’s brutal rental market, the final insult has arrived: bidding wars.  While you, as the owner of a home and the land it sits on, are entitled (in a free society) to get the absolute best price anyone will offer you – and what better way to get a best price than an auction, or a bidding war – the downside is not so obvious, or maybe it really is obvious!  The downside is – in major cities like Boston or 100 other cities across the nation – uber-wealthy folks will want another pad in another city and be willing to pay way above "market value," because it's chump-change for them, leaving one less home for a finite number of Bostonians to call home.  Before you know it, Boston will become a city of absentee landlords, who rarely show their faces or who rent at exorbitant rates to their buddies who can afford to rent another pad in another city.  There goes the neighborhood!