Thursday, February 01, 2007

A Better Rent Control -- Through Vouchers

Landlords and tenants may both benefit by replacing rent control with "rent vouchers."

Tenant advocates argue that because housing is a need, landlords should be forced to provide housing at an "affordable price." But food is a greater need, yet society doesn't force grocers or restaurants to subsidize the poor with "food price control." Instead we have food stamps that the poor may apply to their food purchases. We should likewise abolish rent control and give vouchers to the needy, which they could then apply to their rents. Landlords, needy tenants, and prospective tenants would all benefit, and they system would be both fairer and freer.

* Mobility for tenants. Under rent control many tenants are stuck in apartments they'd like to leave, if only they could find a comparably priced apartment elsewhere. But rent vouchers (like school vouchers) would be portable. Tenants could apply them to the building of their choice, just a food stamps can be spent in any grocery store.

* More affordable housing. New and prospective tenants are hurt by rent control. Current tenants in rent controlled apart­ments won't vacate. Developers are less likely to build afford­able housing; they prefer to invest in condos and luxury apart­ments, wary of building units that might later be "confiscated" in a hostile political climate. Abolishing rent control would free up old units for new tenants, and rent vouchers would help them afford it. It would also encourage developers to build new moderately priced units, and landlords to maintain their current buildings.

* Less fraud. Tenants cling to rent controlled units they no longer use as a primary residence, often illegally subletting them. Landlords bear the unfair burden of hiring private inves­tigators to prove such fraud. Innocent tenants see this as harassment. Housing vouchers would eliminate the incentive for tenant fraud and landlord harassment, which means...

* Less court congestion. Courts won't have to hear so much landlord/tenant litigation. That means quicker court dates for other cases.

* Fair to landlords. Grocers aren't expected to bear the sole burden of feeding the poor. Rather than legislating food prices, everyone pays taxes for food stamps. Likewise, it's only fair that society share the burden of housing its poor through rent vouchers, rather than punishing landlords for supplying a need.

* Targets needy tenants. Rent control is a moral farce partially because there's no means testing. Some tenants are wealthier than their landlords; in such cases the poor are sub­sidizing the rich. A rare instance? Maybe, maybe not. In any event, rent vouchers (like food stamps) can be means tested, so that only needy tenants receive them.

Although rent vouchers surpass rent control in promoting economic efficiency, freedom of movement, and justice, there will be opponents. Many people benefit from the inefficiencies and injustices of rent control. Lawyers and private investigators profit from the litigation. Politicians (notably, Santa Monicans for Renters Rights) benefit from landlord/tenant conflict. There are no political battles between grocers and eaters; both are satisfied with food stamps. Where's the political opportunity in that?

Wealthy tenants are another hurdle. Why surrender rent control if you won't qualify for vouchers? And while prospective tenants would benefit from rent vouchers, prospective tenants are harder to organize politically than current tenants. Taxpayers will also balk. Why share the burden of housing the poor, when you can shift the entire burden to landlords? (Feel good about your "progressive" vote for rent control--without having to pay for it!)

Opponents will also argue (many, ingeniously) that vouchers are an attempt to eliminate affordable housing; that first we replace rent control with vouchers, then we eliminate vouchers. Not so. Rent control exists because tenants outnumber landlords in the voting booth. That won't change. There's no reason to imagine that rent vouchers will be endangered any more than food stamps.

Needy tenants will gain mobility through vouchers, prospec­tive tenants will see an increase in affordable apartments being built, current buildings will be better maintained, and landlords will be treated more fairly. That last one alone will infuriate class warriors, some of whom would rather punish needy and pros­pective tenants than have any benefit accrue to landlords (desp­ite the irony that some landlords are poorer than their tenants).

Even so, rent vouchers make greater economic sense than rent control. And they promote greater fairness and freedom.

1 comment:

Brian said...

I know everyone has their anecdotes, but here's mine on rent controls. In Berzerkeley I lived in the old Haywood apartment building near downtown and UCB. Had about 24 units. Half were probably students. The other half were retired folks and in my case young professionals seeking affordable rents. My spouse and I paid 1350 a month for our abode. I had made friends witht eh apartment manager who told me the 76 year old man next door had lived there for 14 years and was paying 440 a month for the same size unit, we did have a few more windows being on the corner. This old retiree also had a vacation home in Minnesota, it was a small home he inherited from his parents and rented to a nephew on the cheap, on the agreement he could spend summers there in the guest room.

Rambled about all that to say. It occurs to me that since the landlord will make his profit no matter who pays, who pays then are tenants who don't stay for years. so students, who are often poor of funds, subsidize the rent of the older folks who benefit from the rent control, but have possibly more capital or wealth.

I do think vouchers are a more fair way to go. If someone needs help with in reason, student or the elderly, then a voucher seems reasonable.

But rent control is only means where by the old are stealing from young!