Pros and Cons of Rent Control Review

Pros and Cons of Rent Control

In almost every country, more people rent homes rather than owning a home. Rent control programs protect tenants. Various states use rent control to determine the limit to which a residential property is charged. Rent control policies only exist in various expensive markets. Every state has different rent control policies but each landlord should always keep in mind these pros and cons.


1. Reduce rental cost: Although every state has different rent control policies, it results in lower rents to tenants. Some states allow landlords to raise tenants’ rent once per year based on a certain cap set by rent control laws. Otherwise, without the rent control measures in place, many tenants will be priced out of their rental homes.

2. Access to more homes: Low-income tenants will have access to more secure homes where rent doesn’t rise more often. Though the tenants may have difficulty finding the home, they may not struggle in keeping the homes because of the regulated prices.

3. Lease renewal: Because the rents are capped, tenants can stay in the current home for a couple of years. They only need to renew the lease every year. The landlord also doesn’t have to look for tenants to occupy the vacant house since the current tenants are likely to renew the leasing agreement.

4. Easy to manage: The landlord will be able to easily manage the building. The building will always be full since most tenants will want to hold on to the current house.

5. Reduces moving cost: If there are no rent controls, you have to move out of the current home which is very costly. It also saves you from moving more often which is very stressful.

6.  Protection: rent control cities have tenant protection. For example, landlords can only end the month-to-month tenancy after 30 to a 60-day notice. Also, they can evict a tenant for violating the agreement, nonpayment of rent as well as an unlawful rental unit

7. Lowers competition: the competition is low and the demand for rent control goes up.

8. Decreases displacement: research carried out by Stanford University found that rental control decreases mobility. This lowers the displacement of the population.

9. Reduces tenant’s eviction: tenants pay rent on time to avoid being evicted.

10. Saves time: the policies favor landlords. This allows them to save money and time in case of eviction.


1. Lack of incentive to upgrade: Landlords often upgrade the homes by installing new appliances and other features to raise the rent prices. If rent control measures are put in place, the home upgrade is minimal since no incentive to upgrade the homes. Even if the landlord upgrades the homes, he has to abide by the rent control laws.

2. Old buildings: Though rent control laws are aimed to favor tenants, they’re mostly exercised on older units. You will have controlled rent but won’t get all the amenities available in the modern houses or those in uncontrolled rent apartments.

3. Rent prices fall below market cap: The prices of rent-controlled apartments tend to fall behind. Sometimes the prices may fall below the market prices and the landlord won’t make enough income from the apartment. Rent capped at a particular rate makes it difficult to attain one’s financial goals.

4. Discourages real-estate investments: With rent control laws in place, investors and real-estate developers won’t have incentives to develop new homes or apartments. The apartments may take long before earning enough revenue thus not worth the risk.

5. Low rent tenants: Since you can’t raise the rent by improving the units or evicting tenants, you will be stuck with low-rent tenants.

6. Lowers mobility: rent control lowers the migration of people from one place to another. According to the National Multi-Housing Council, it discourages tenants from moving. The units are always available in expensive places like New York and California thus individuals will have a reason to stay. However, this discourages old and young folks. It affects individuals who want to move to other cities and look for better jobs.

7. Issues on quality: rent control affects the quality of housing. Investors are discouraged to upgrade properties. Landlords always want to increase the rent after repairing a house to cover the repairmen’s costs. Regardless of the improvement made in the house, the tenant is forced to pay higher rent than before. In addition to that, not every investor is ready to improve quality.

8. Additional expense: since rent control is based on the local government, some systems should be established to deal with the process. For this reason, an additional fee is added and covered through income taxes.

9. It decreases maintenance: investors can only improve a property if there are high profits. Nonetheless, rent control can fall depending on the market. This causes profits to be limited. Henceforth, a property owner does less on maintenance. Some may end up abandoning houses because they make a loss.

10. Lowers income tax revenue: income tax is received by the government through taxpayers. Rent control reduces the income taxes taken from landlords for the houses. This occurs when profits from landlords are reduced thus affecting income tax revenue.

11. Increases entry cost: rent control affects the demand for properties in places that are used extensively .as a result of this, it increases expenses for signing lease contracts and leasing property. Homeowners are forced to pay additional charges such as finder’s fees or referral fees. It is paid for the introduction of a buyer to a seller for a successful transaction. The fee ranges from 10% to 50%. This fee can outweigh the amount saved for the property.

12. Lowers property tax revenue: property taxes serve as a source of government revenue. It is controlled by states, cities, counties, and other local governments. Money plays an important role in the economy. It is used to improve hospitals, schools, hospitals, roads, fire departments,s, and police. Rent control affects property taxes by reducing the amount collected. This occurs when there are a lot of abandoned properties. This lowers the property of values hence limiting the property taxes.