Redwood City nixes rent control
Economists reject rent control as counterproductive gov't meddling. The midpeninsula city agrees and shuts down Measure E.
Bay City News reports
A measure to introduce rent control and expand tenant protections in Redwood City lagged behind the needed majority in early results on election night.
The measure proposed establishing an annual rent increase cap of 60% of the percentage change in the Consumer Price Index, or CPI.
It also proposed greater tenant protections on just causes for eviction, right to return, relocation assistance and anti-harassment protections. It would have added additional protections for students, educators, older people, disabled or terminally ill tenants.
While the proposed rent caps would have been limited to certain types of units, the tenant protection provisions in the measure would apply to all rental units in Redwood City.
Several councilmembers took issue with Measure E. A supplemental report on the fiscal and economic implications of the measure found that the city would incur significant costs to implement the measure and that it could discourage housing growth, place significant burdens on landlords and cause financial strain on deed-restricted affordable housing.
Merc reports
Opponents include the City Council, which voted 6-0 in July to oppose the measure and include an official ballot argument against it.
RWD Pulse reports
The measure, which would have added stricter rent control, with increases capped at 5%, and expand tenant protections, still appears to be failing with just 43.89%, or 7,466 votes, according to the latest report filed at around 4:30 p.m. Friday by the San Mateo County Elections Office. Just over 56% of the vote, or 9,544 votes, are against Measure E.
Why economists are thumbs down on rent control
Economists were polled with the following question:
Local ordinances that limit rent increases for some rental housing units, such as in New York and San Francisco, have had a positive impact over the past three decades on the amount and quality of broadly affordable rental housing in cities that have used them.
Eighty-one percent of them disagreed.
Why are economists so overwhelmingly against rent controls?
[R]ent control will do nothing whatsoever for [the homeless]. The problem, remember, is too many people wanting to live in a given stock of housing. Capping the price of that housing by government decree will do nothing to solve that problem. What would help is getting rid of the government regulations that restrict the supply of housing.
Prices are not problems; they are signals of problems. Trying to solve the problem by treating the signal is like trying to slow down your car by fiddling with the speedometer.--Foundation for Economic Education
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