> The forces of supply and demand can be overridden, but then you have to enforce the rules

Enforceability is a key factor in whether a law will work. "Proper" use of rent control, like narcotic use, is very difficult to enforce without extremely authoritarian measures.

People are rationally responding to incentives that exist. It's hard to get a rent controlled apartment because there is more demand than supply. So people are incentivized to give them to family because otherwise it could take a decade to get them.

People in this case are responding to the need by renting out rent controlled apartments for a very large premium to people who under normal conditions may not be eligible to live there in the first place. Same thing here in NL, with in the larger cities a healthy dollop of AirBNB tossed in for some extra artificial shortage.