Do rent controls work?

Re:Do rent controls work? by thephyber on Tuesday September 01, 2015 @03:45AM (#10151193)

That is the same situation which was sold to the voters of California in 1979 for Prop 13 and now we have underfunded schools, fire departments, and police departments. Property values are now artificially inflated because long-time owners are underpaying property taxes (they are growth-capped) and recent purchasers are paying much more for identical properties. Additionally, Prop 13 is an effective real estate transaction friction which keeps inefficiency in the housing market.

I would hope the city would offer to partner with a shrinking small town to help relocate people who can no longer afford to live in the city to a town that is suffering from a high rental vacancy rate. A pensioner will only continue to be squeezed by living in a high-demand city as even rent-controlled units are allowed to raise their rents.

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Re:Do rent controls work? by iofj on Tuesday September 01, 2015 @04:18AM (#10151273)

> That is the same situation which was sold to the voters of California in 1979 for Prop 13 and now we have underfunded schools, fire departments, and police departments

And these 2 are related ... how ?

California is broke, which is what causes those underfunding issues. Why ? Nobody is blaming rent control. It's there, but it's so small it registers on very few radars.

Rightist view: http://www.businessinsider.com.au/reasons-to-leave-californi... (TLDR: unemployment (due to various high taxes, rightist site indeed), debt (pension/unemployment liabilities), poverty)

Leftist view: http://www.huffingtonpost.com/bob-samuels/why-california-is-... (TLDR: tax exemptions for large corporations, including the claim they wouldn't leave for high tax because of good schools)

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Re:Do rent controls work? by thephyber on Tuesday September 01, 2015 @05:20AM (#10151421)

My previous post's parent discussed an 80 year old pensioner being unable to afford to continue living in San Francisco (or some other hypothetical rent controlled city) despite the fact that they can't afford to live there without rent control. That was the exact scenario that was sold to California voters in 1978 for Prop 13 and people voted for it because it seemed like it would benefit them (at least in the short term) and actually does the opposite long-term.

Re: the financial situation, California only recently paid off debts left over from the wake of Enron criminal fraud days.[1]

Obviously the underfunded retirement funds are huge looming unknowns, but they are partially (if not mostly) caused by local governments (such as the city of Stockton) underfunding during the bull market years and being unable to pay during the bear market years.

[1] https://en.wikipedia.org/wiki/California_electricity_crisis

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