« Social Security as Realpolitik | Main | Cafta Testimony» Russell Roberts
May 02, 2005
Rent-Control Follies
Don Boudreaux
If Alex or Tyler at Marginal Revolution would blog on this story in today's Washington Post, they’d do so under their heading "Markets in Everything."
Here’s the summary of the story: Landlords in New York City hire professionals – called "facilitators" – to negotiate with tenants of rent-controlled apartments in the hopes of enticing tenants to move out. In many cases, the sums of money paid to agreeable tenants run into the hundreds of thousands of dollars.
The reason for such payments – the reason a market in facilitators has arisen – is New York City’s perverted policy of rent control. Gotham’s rent-controllers generally prohibit all but minuscule increases in rental rates – except when tenants voluntarily move out, at which time the permitted adjustments in rental rates (to be paid by the new tenants) are typically much larger. Relatedly, if a landlord wants to convert his apartment building to some other use, his tenants can often prevent such conversions simply by refusing to abandon their apartments.
What’s a landlord to do? Answer: pay tenants to leave.
It’s perverse, of course, as understood by this landlord quoted in the Post story:
"In every other city landlords want to keep people in their homes as long as possible," chuckles Richard Aidekman, who owns 10 apartment buildings here. "Only in New York is the goal to get them out."
Keep in mind – if landlords use sizable carrots to entice their tenants to move, landlords surely also use sticks. Can anyone really expect that New York City landlords will be attentive to their tenants’ complaints about, say, lack of adequate heat, low water pressure, poor plumbing, and surly doormen?
In this Post story, the reporter refers to New York City’s rent-control regulations as "tenant-friendly." Hmmm. In what way is a policy that encourages suppliers (landlords) to run way their customers (tenants) friendly to tenants?
Posted by Don Boudreaux in Regulation | Permalink
TrackBack
TrackBack URL for this entry:
http://www.typepad.com/services/trackback/6a00d834518ccc69e200d8342368a653ef
Listed below are links to weblogs that reference Rent-Control Follies:
» Piete: prin, peste, prin jur from Gabriel P. Mihalache
[Cafe Hayek](http://cafehayek.typepad.com/), un blog cooperativ genial, dedicat interpretarilor Hayek-iene, [ne povesteste recent](http://cafehayek.typepad.com/hayek/2005/05/rentcontrol_fol.html) despre efectele indobicitoare ale etatismului si sociali... [Read More]
Tracked on May 2, 2005 9:37:14 AM
» Monday's Daily News from The Club for Growth Blog
Stagflation Nonsense - Larry Kudlow, National Review Bush Calls The Dems’ Bluff on Social Security - WSJ Editorial Social Security Misdirection - Peter Ferrara, Wash Times A Skunk in the Polls - Herman Cain, Washington Times Social Security Schem... [Read More]
Tracked on May 2, 2005 10:20:24 AM
» Unintended consequences - rent control from blogs for industry
Cafe Hayek notes an unintended (I hope) consequence of rent control in NYC:
Landlords desperate to vacate the premises have legal remedies in some cases. But what do they do when war is not an option?
They hire Mike Grabow. It's his job to talk... [Read More]
Tracked on May 2, 2005 1:36:06 PM
» Los facilitadores from La Hora de Todos
Los facilitadores, o los habilitadores, como fuere más correcto traducir facilitators, son profesionales que negocian con los inquilinos de casas con renta controlada (renta antigua) cuánto dinero pueden pagarles para que se vayan. [Read More]
Tracked on May 3, 2005 5:43:01 AM
» Os disparates são iguais em todo o lado from Rabbit's blog
Na série, sentimo-nos em casa:
Controlo de rendas em Nova Iorque tem efeitos perversos.
... [Read More]
Tracked on May 6, 2005 7:31:41 AM
» BRILLIANT from Pejmanesque
The rent-control laws in New York are enough to drive any sentient human being stark raving insane (unless said sentient human being is a beneficiary of the rent control laws), but they also help inspire truly ingenious strategems: Before they... [Read More]
Tracked on May 7, 2005 11:28:33 PM
» The Housing Crisis from Mises Economics Blog
Why can't the private sector address the "crying need" for affordable, decent housing? The short answer is that it isn't a private sector phenomenon but rather that regulation and restriction are in large part responsible: Ed Stringham and Ben Powell... [Read More]
Tracked on Jun 16, 2005 8:31:04 AM
» Funding of £4m to tackle suicide from tackling suicide
than £4m will be spent on tackling suicide in Northern Ireland over the next two years, the government says. [Read More]
Tracked on Apr 5, 2006 2:56:39 AM
» Full Albums Archive from MP3 Album Finder
Enter Artist or Song or Album name to search: ... Download VA - –усска€ коллекци€ 4 «олотой шл€гер 70 х (1973 1979) mp3 ... [Read More]
Tracked on Apr 5, 2006 4:06:57 PM
» Dallas' Erick Dampier Fined and Foul Upgraded from received an upgraded
Mavericks has been fined $5,000 and has received an upgraded Flagrant Foul Penalty Two, it was announced today by Stu Jackson, NBA Senior Vice [Read More]
Tracked on Apr 27, 2006 12:02:37 PM
» Auto Search: 1937 chevrolet master cylinder from Online Auto Guise
Search and Compare Certified Pre-Owned Cars. Car Shopping Tools and Advice · 2006 Auto Shows · New York Auto Show Check out 2007 models and cool concepts ... [Read More]
Tracked on Apr 27, 2006 7:32:14 PM
» Finance Search Online: custom insurance motorcycle from Business Finance Online
Business Finance Online Product/Service Directory. Search for business finance related products and services by browsing the directory of business finance ... [Read More]
Tracked on Apr 28, 2006 12:00:59 PM
» Wisdom of eBay's anti-Google move debated from to work, and
space and in the broader Web portal market.
Analysts disagree on whether eBay's [Read More]
Tracked on Apr 28, 2006 7:02:55 PM
» Library of Congress WWW/Z39.50 Gateway from Harvard Seismology: Centroid Moment Tensor Catalog
Contents: Search Library of Congress Catalog | Search Other Catalogs | About the Z39.50 ... Library of Congress Online Catalog. Simple Search (any keyword) ... [Read More]
Tracked on Apr 30, 2006 2:42:23 AM
» Dictionary Search Page from Dictionary Search
An unabridged dictionary from aalii to zymurgy, including a pronunciation guide... [Read More]
Tracked on May 22, 2006 3:30:17 AM
» Amare Stoudemire Out for the Year from in his attempt
week. This is not the same knee he had microfracture surgery on in October (was left knee). [Read More]
Tracked on May 23, 2006 8:13:12 AM
» US and EU rule out new food laws to fight obesity
(Reuters)
from industry
to
obesity, in spite of concern that the problem is
becoming a serious threat to health worldwide. [Read More]
Tracked on May 23, 2006 3:08:55 PM
» Justices Order Rethinking of eBay Case - New York Times from Justices
and, quite likely, still not final phase on Monday when the Supreme Court sent the case back to the lower federal [Read More]
Tracked on May 26, 2006 5:00:41 PM
» Antonio Davis Hops into the Stands from up his reasons
if I didn't react. There was no time to call security. It happened too quickly.
It's [Read More]
Tracked on May 27, 2006 2:15:03 PM
» Internal Audit: Resources for Internal Auditors from Audit Company
Internal Audit - is the Web portal and online community for the internal audit profession provides free audit work programs, ICQ's, checklists, ...
[Read More]
Tracked on Jun 7, 2006 3:42:43 AM
» Sony Seeks Young Tech Talent from share by having
chairman seeks to boost the Japanese company's market share by having product designers and younger software engineers collaborate at [Read More]
Tracked on Jun 30, 2006 9:48:29 AM
» Dell Warns on Profit Outlook from computer maker
maker Dell warned that profit would fall expecations for the second quarter. [Read More]
Tracked on Jul 24, 2006 10:44:34 AM
