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Federal rent control would be a disaster

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Next to aerial bombardment, the fastest way to destroy housing is rent control. Yet that’s what would happen should 50 Democrats in Congress get their wish. In a recent letter to President Biden, they urged him “to pursue all possible strategies to end corporate price gouging in the real estate sector and ensure that renters and people experiencing homelessness across this country are stably housed this winter.”

Although they didn’t use the words “rent control,” that’s the essence of what they’re calling for: federal control over rents.

California representatives signing the letter included Rep. Katie Porter of Orange County, now running for the U.S. Senate, who has a knack for backing the worst legislation; Nanette Barragán of the South Bay; Judy Chu of the San Gabriel Valley; Ro Khanna of Silicon Valley; Barbara Lee of Oakland, also expected to run for the Senate; and Mark Takano of Riverside.

California already has rent control by way of Assembly Bill 1482, the California Tenant Protection Act of 2019. It caps annual rent increases at no more than 5%, plus the increase in the local inflation rate (the consumer price index), with a maximum of 10%.

Jurisdictions like Los Angeles and San Francisco have long had rent control policies on the books. Do either cities seem affordable to you? And as anyone has probably noticed, there are a lot of old apartment buildings in those cities. That’s not a mere aesthetic decision on the part of the cities. That’s a testament to the fact that rent control policies are yet another constraint on housing production.  Basic economics.

If House Democrats want to really help renters, they should stop supporting inflationary spending sprees for one. Last year’s $1.7 trillion spending bill was a key driver of the ongoing inflation rate of about 8%, a tax on the poor and middle class. In return, the Federal Reserve is fighting inflation by boosting interest rates — which discourages housing construction.

If California’s Democratic congressional delegation wants to help renters, its members should suggest to their counterparts in Sacramento helpful ideas like California Environmental Quality Act reform and slashing mandates on housing construction. That would help far more renters over time than rent control.

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