A Policy That Sounds Great...Until You Look Closer

Why Rent Control Rarely Works (Even If It Sounds Good)

Sadly, this two-minute read won’t solve the affordable housing crisis. But we can spotlight one policy that’s been tried for decades and consistently failed: rent control.

At first glance, the goal seems noble—make housing affordable. But rent control often backfires in ways even its biggest proponents didn’t expect.

When governments cap rents, investors respond rationally (not maliciously). If returns drop below viable thresholds, capital leaves. Landlords sell, exit the area, or stop improving their units. Remaining properties deteriorate as owners cut costs—usually starting with repairs and maintenance. You’re left with a declining rental pool, run-down buildings, and tenants stuck in units that no longer get better—just older.

Think of it as a well-documented recipe for neighborhood stagnation.

Rent control requires policymakers to:

1. Prioritize a perceived crisis over the rights of property owners

2. Believe investors will ignore financial realities for the public good

3. Assume alienating property owners won’t backfire politically

We get it—housing affordability is a real problem. But if rent control worked, it would’ve worked by now. The evidence just isn’t on its side.

Unbiased Business Insights, Every Week

Get a weekly knowledge digest of business insights from 1440’s Business & Finance newsletter. Expect concise rundowns, context-rich visuals, and curated links to keep you ahead of the finance curve. Join 1440 for crisp explanations of business trends —no MBA required.

Sign Up Here