Economic Theories of Rent Control

Economic theories of rent control suggest that setting limits on how much landlords can charge for rent aims to make housing affordable, especially in high-demand areas. However, critics argue it can lead to reduced investment in housing, causing shortages and deteriorating living conditions. Supporters believe it protects tenants from sudden price hikes and displacement. The main challenge lies in balancing affordability for renters with the need for adequate housing supply, as overly restrictive controls might discourage new construction, worsening the very problem they seek to solve.