The rent for landlords cannot exceed the last five years’ rent, plus a 3% increase for 2024. The landlord also has to pay the rental fee to the agency. The last added enforcement was made a week ago. The law now requires short-term rental contracts to have the same conditions as long-term rentals.
Price controls create SHORTAGES of things. Rent controls are price controls, and rent controls make landlords feel like slaves to the government, which is the intention of rent control laws. So, instead of renting their apartments, what would have been landlords will simply withdraw their rental apartments from the marketplace altogether?
If a city is popular, rent control laws will typically lead to a housing boom as landlords become real estate flippers. Why rent my apartment and clean toilets? Being a slave to the renter, I can’t evict when I can sell my property for a higher price. As long as the price of housing keeps rising, my existing apartment will become an ATM machine.
Typically in response to this government will then impose a tax on selling the house, but all that does is make the price for housing rise faster or remain stagnant.
The landlord shortage, starts with rent controls. Being that rent controls are usually never abandoned, this will eventually lead to financial crisis. Housing should always remain a CONTRACT, between two parties, if the government wants to get involved, in that process, it should do so in limited fashion.
By limited fashion, I mean if the tenant and landlord have a disagreement, it should be handled by the courts. Sweeping legislation to “solve” a problem, that should remain between two people.
We all do not like to move, but the truth is that having an abundance of landlords is far better than having a dwindling number of landlords. If you’re of lower intelligence, you’re assuming that AirBNB is the problem. The truth is that AirBNB is the result of landlords not wanting to deal with local governments when an unruly tenant, protected by local governments, feels entitled to the property owned by someone else.
Hotels often raise their prices, and only build luxury hotels because of local government regulations. There is no perfect system, however when you vote for rent controls or any other government price control mechanism, be warned that there are consequences, and those consequences are SHORTGAGES. Rent controls will always create shortages of rental housing.
Why would I become a landlord when I know that once I do, I’m basically a slave to my tenants and the local government? It would be far smarter to buy, hold, and then flip the property for a profit acceptable to me. If the government imposes a tax on me to do this, I will add that to the selling price. If the government nationalizes the property, well, then the housing problem becomes the government’s responsibility.
This means that every single toilet that needs to be fixed, all electrical or elevator-related problems, will then become the responsibility of the government and all taxpayers.