RENT CONTROL DEBATE 

In 2000, I moved to Boston and what brought me here brought a lot of people to Boston: a job. Also, it’s a fantastic city, but it’s not exactly a cheap city. I was led to believe New York City was the only east coast city that was expensive. I was wrong. Many people from Connecticut and New York have this belief. Affordability is also a topic that news and politics always cover. Everyone acknowledges we have a Big Problem but it’s not an easy issue to solve. 

In 1995 Massachusetts eliminated rent control. Now in 2023, the topic is coming back into focus. Renters might be jumping for joy or rejoicing but it might not be the solution you are looking for. Here are the Pros and Cons of cities and towns that have rent control. 

 

Pros of Rent Control 

Fewer vacancies. Rent control puts a cap on the amount that a rental rate can increase each year. So what happens if tenants stay long-term? 

Less wear and tear on units since the unit turns over less 

Tenants can find an opportunity to increase their financial stability when rent control laws exist. The legal cap on any rent allows tenants to save since rent increases can’t happen like they can now.  

Cons of Rent Control

Turnover is less which means less inventory in Boston and Cambridge. Our inventory will reflect the change and the shortage will get more severe.

No incentive to upgrade appliances and rental features every few years to keep tenants or attract new ones 

Places below market rate apartments and houses may fall below market rate. 

Rent caps might make it more difficult to reach financial goals but they could hurt the upkeep of properties. Resources to cover maintenance could be allocated to deferred maintenance. The deterred homes could negatively impact the neighborhood and could hurt home values over time   

Financial issues for the property owner and real estate investors might be less encourage builders and investors from creating residential housing. The lack of houses will become a bigger problem than we currently have here.

It might become more difficult to sell your rental unit because buyers will have to consider the cap on rent. This might play a role in the buying decision 

Currently available rental supply may turn back to condos. In other words, the rental supplier will be less than what we currently have.  

If a buyer has a loan with a bank to cover the purchase the rent cap might limit your income. Which will put a burden on the owner to pay the loan off. 

Studies have shown in the United States and Europe that rent control doesn’t increase the housing supply it reduces housing.  

When Boston had rent control 

In the 1970s Boston had rent control. Landlords couldn’t evict tenants without the first security certificate of eviction from the rent control authorities. Landlords who charged more than the maximum allowed rent risked liability for damages and attorney fees. A willful violation could result in criminal penalties. Massachusetts appeals court in 1988 Commonwealth vs Kapsalis upheld the criminal conviction. Kapsalis was given a six-month sentence. A Cambridge landlord willingly and fully removed a controlled unit from the rental market. The removal was due to rent control.

 

Solutions to be looked at and discussed 

Rent control ended in 1994-1995 and yes everyone needs to be able to afford a place to live. Maybe the solution isn’t renting control but rather making it easier for builders to construct. It’s very expensive to build in the state of Massachusetts, especially in Boston and Cambridge. Developers and builders have a lot of challenges when they want to build. Many developers or builders won’t deal with building in the state of Massachusetts. Another part of the puzzle that needs to be addressed is our failing MBTA system. If we had more communities that could depend on reliable mass transit options, can you imagine how everyone’s lives would improve? We would find people could look further out to find housing solutions. Also solving public transportation would make a difference in our traffic which is the most problematic in the country. 

 

Boston Limitations adding to challenges

Some experts have suggested the way to tackle this complex problem is to bring different sectors to the table to solve the issue. If we do it right it might be a road map for other cities. The city is unique because it was built when horses and carriages were in use. Many other cities in the United States burned down to the ground. They had the chance to redo their entire city layout. While Boston, Cambridge, and Brookline have a history, many other parts have unique limitations. Most of the areas were farmland and transportation was by horse and buggy for a long time. 

Commercial Real Estate Role

One solution worth considering is to look at our commercial. We have so much office space that is not used due to remote work. Why do those spaces need to be used in that way or why should they just be empty? Maybe they should be repurposed and turned into housing for people.  

Zoning Laws and who the housing helps must change 

I do not think rent control is the solution. I do think zoning laws must change. Developers need less red tape. The cost needs to be re-evaluated. You might even want to offer them an incentive. Whatever housing is built should not target the high end, but rather the low and middle end. We have tons of high-end housing, but not much for those who are low and moderate. Rent control can prevent people from moving. They might think it’s cheaper to rent for the rest of their lives than to buy a home.  

Multiple Parties need to be invited to the table to solve the housing issue

All the politicians who say they want to fix the MBTA need to fix the MBTA problems and expand out to areas.  Not everyone can afford a car or wants a car. The fewer people who have cars the better or traffic issues will be. Public transportation just increases the value of areas and makes them more desirable. Our housing problems require multiple sectors a seat at the table to solve this issue. Developers, real estate agents, economists, engineers, MBTA, planning boards, landlords, and maybe a few voices of the general public.

We attract the most talented talent that seeks education at some of our finest universities and colleges. Everyone keeps an open mind and comes up with a plan where we create more housing. The more housing we create will help with affordability. People who choose to stay in a community can. As a real estate agent, I would like communities to have housing that is kept up. I am interested in housing in neighborhoods that offer a diversity of renters and owners. I do not want renters to be pushed out of a rental too soon. However, I also do not want to see the same party rent out an apartment for years or decades. We allow rent control and this will become a trend we will see.

Consequences if we do not solve the housing issue

We will move from a world-class city where people could eventually find housing. To a city where new people who move into the city will find fewer options. They will ask these questions: Why can’t I live here? Why are there no housing options? They will see firsthand how rent control doesn’t increase growth. It just stops it in its tracks. We will find fewer companies that set up shop here, and fewer people will stay here. Our thriving economy will likely also suffer. In 2022 it was reported that 57% of people left the state of Massachusetts for another state. The top states that saw populations increase were Maine and New Hampshire. Those areas have more housing supply making it more affordable to call home. If we do not get a handle on our housing issue this could affect many other sectors that we do not even realize.

 

 

Boston has a history of being first 

I do not have the solution nor claim I do, but I do think it’s a problem we can solve. It will require many great minds willing to work together to solve this issue. Rent control isn’t the solution and won’t even be a bandaid we can work with in the meantime. Let’s hope everyone rolls up their sleeves and does the real work we need to do. Build more and get rid of red tape. We can do this we are the home of first. The first subway system in America, we created the first public park, and we created the first public school at Boston Latin. We can be the city that solves our housing issue. If we solved it we could be a roadmap for other cities. We have an opportunity to make a change that could help other cities that struggle with the same issue.

Conclusion  

I love this city and its surrounding areas, but rent control isn’t the solution. It will take us backward and we need to move forward. Reform is necessary, but rent control is not the solution. Rent control doesn’t even provide a band-aid to the problem. Boston needs real solutions that won’t happen overnight but can happen if we all do the leg work. Please tell Mayor Wu not to rent control.