Greens ignore evidence in calls for rent controls

Stuff reports:

The Green Party and The Opportunities Party have announced they will both support the introduction of rent caps which would limit the amount a landlord could increase rent.

Of their many awful ideas, this is one of the worst.

Megan McArdle in the Washington Post writes:

There aren’t that many things you can get economists to agree on. Fiscal stimulus, minimum wages, monetary policy, health care, bank regulation — on almost all the major issues of the day, you can find a respected economist to argue for either side.

But there are a few questions where there’s near unanimity, and rent control is one of them. Pretty much every economist agrees that rent controls are bad.

Rent control is just a form of price control, and they have failed in almost every country that has tried them.

Declining housing stock is just one of the many potential costs of rent controls; others include a deteriorating housing stock as landlords stop investing in their properties, and higher rents. Yes, higher, because rent control creates a two-tier housing market. There are cheap, price-stabilized apartments that rarely turn over, because why would you give up such a great deal? Then there are the uncontrolled apartments, which everyone else in the city has to fight over, bidding up the price.

Just another reason not to vote Greens.