Rent controls are just a short-sighted way of giving hand-outs to people who are politically connected or otherwise good at navigating bureaucracy. It's a price ceiling, with all the classic issues of them: shortages, quality reduction, search costs, deadweight loss, and misallocation of resources.

Shortages: More people want apartments than can get them.

Quality reduction: if you're in a rent-controlled apartment, the landlord knows you aren't going anywhere, so why would they improve the building in any way that they can avoid?

Search costs: joining a decade-long waiting list for an apartment. Fun.

Deadweight loss: Developers want to build places that people would benefit from renting, but they don't, because it's illegal to charge rates that would make them money.

Misallocation of resources: someone with a $400/mo rent-controlled apartment in a prime location in downtown SF will keep it forever, even if they only use it a couple weekends a year. Or people commuting from SF to Mountain View can't trade apartments with people commuting from Mountain View to SF, since they're locked into their rent-controlled place.

When so much research and expert analysis shows something is bad, lay people are somehow oblivious "eh, I just don't believe it".

Worse yet, why is it so easy for people to like the idea of rent control but dislike the idea of cash assistance? If you want teachers (or whomever) to be able to live nearby, fine then just give them a cash subsidy.

Giving out cash doesn't kill the market economy, allows the benefit to be given out precisely, and anyone you want can pay for it via a tax - landlords, rich people, sales tax, whatever.

Do nothing or do something, just don't do rent control which hurts everyone.

So you actually just exacerbate the situation. Rent control is one of those things that sounds good at face value but once you think about it a little more you realize it's a terrible idea.

There's a lot of way we could determine who gets a slice and who doesn't get a slice. We could give slices to people who have been there longer. Or we could let people who have more money and value the pie slice sufficiently high to spend their money buy a slice. We could give some money to people who really really want a slice but just can't afford it. We can debate and argue about all the ways we could pick the pie slice winners.

But at the end of the day it doesn't matter. The exact same number of people will get slices. And the exact same number of people will not get a slice. All we're doing is picking winners and losers in different ways.

The only debate that matters is the one that grows the pie. We need more pie so more people can have a slice. Taking a slice from Peter to hand to Paul is an utter waste of time.

I wonder what a more broad-based proposal would look like, one that also had some right-wing/market-friendly features. The left gets rent controls, and the right gets what? As-of-right construction? Relaxed zoning rules? Whatever it is, it would have to be pretty major for the right to put up with rent controls.

(By "the right" I mean pro-business democrats mostly, because we are taking about a very blue area of the country.)

I understand the opportunity costs of rent control: if rents in your neighbourhood have gone up 50% this year you feel like a sucker if you can only raise them by 5%.

Similarly you might put off minor renovations (that don't require the tenant moving out) because you won't necessarily be able to charge more to make up for the cost (apart from selling the property).

But is it common to rent out a property below cost, assuming you can make it up later with rent increases? E.g. you just bought a property in Mountain View so your mortgage payments are high, plus the cost of all of the new appliances, and maybe it's an older house so labour and maintenance costs are higher than the $4k/mo you charge in rent.

http://urbankchoze.blogspot.com.au/2014/04/japanese-zoning.h...

I'm genuinely curious because I think in a few years from now Denver will be in the exact same boat.

Real estate is a broken industry. Moreso in the Bay area, but the negative effects there ripple outward. See: http://ecosteader.com/alternative

In the Airbnb story yesterday, my comment (which was maliciously downvoted), was this:

"Landlords and Realtors get their cut every time there's a turnover in occupancy. Interestingly, this is the root problem at both ends -- from people living in poverty (Portland's sidewalk tent campers who get shuffled around), those suburbanites affected by the housing "crisis", and those who can afford to own in any upscale hip-n-trendy neighborhoods where Airbnb rentals are desperately sought. Those rooting for turnover are usually those who profit the most from it.

Sure, people travel and need to rent rooms once in a while. People like to rent while they're young and mobile, but the two use cases need very serious and separate delineation from each other. Airbnb is pushing them more into "overlap" territory. Airbnb's expansion into "subletting" was the kicker.

So, long story made short: it's an interesting economics problem I've been working on solving in my spare time, as a very long and iterated side project with Ecosteader (ecosteader.com). Some of the details emerging need a better format for communication; however, the most clear thing to come from my research is that people need to _own_, and they need to be able to transact with each other directly. Middlemen (Airbnb is the middleman here) taking significant commissions is part of the problem.

But the middlemen problem has sort of an obvious solution: to tax rental income so aggressively that it's just not an appealing source of investment to people who invest in rentals. Use the tax generated from over-inflated rents to build properties for sale, and/or figure out a way to use that money to grant-deed land on which people can build. This last option seems the more fun opportunity to me, and is what I originally had in mind building an eco- site.

The homesteading movement needs to come back, adapted a bit for the 21st century."

Disagree if you want... but explain how the problem can be solved better any other way.