Is Rent Control Unfair to New Tenants?

Like most governmental price-fixing, rent control invites black-market evasion.

Q: I recently rented an apartment in a city with rent control (or "rent stabilization," as they call it). I just learned that I'm paying significantly higher rent than several neighbors are paying for identical units, just because they've lived here for many years. As best as I can tell, they are affluent professionals who earn a lot more than I do. Do you think this is fair?

No, I don't. Rent control causes all the well-known market distortions common to every kind of price control, such as artificial shortages and disincentives to investment and innovation. But rent control also causes ethical problems because the benefits it confers on some lucky longtime residents are often offset by higher rents paid by newcomers.

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Knight Kiplinger
Editor Emeritus, Kiplinger

Knight came to Kiplinger in 1983, after 13 years in daily newspaper journalism, the last six as Washington bureau chief of the Ottaway Newspapers division of Dow Jones. A frequent speaker before business audiences, he has appeared on NPR, CNN, Fox and CNBC, among other networks. Knight contributes to the weekly Kiplinger Letter.