Post your reply on at least two of the following points regarding the policy of
ID: 1237017 • Letter: P
Question
Post your reply on at least two of the following points regarding the policy of rent control:
Explain the purpose of rent control and the intended effect on consumers and suppliers of rental property.
Does rent control achieve its purpose?
Using the Internet or the Virtual Library, give some detail regarding real-world experiments in rent control policy and their effect on consumers and suppliers of rental property.
How do rent control policies alter incentives for consumers and producers in the market for rental property?
Explanation / Answer
Rent control has several purposes: 1. To keep prices down. This works, but in the process it leads to almost no incentive for owners to keep the properties maintained, leads to less supply of rental properties in the long term and leads to many people being unable to find homes. 2. Political reasoning (I care about you). It usually does as most people don't attribute those consequences to the original cause since it is delayed, and hard to correlate from an inside perspective. I'm not allowed to post links, I am sorry. They give producers little incentive to compete, and buyers need to provide alternative benefits (foregoing things usually in this case, or paying in advance) in exchange for convincing the owner to rent for less than they can get on the free market.