While city officials in Boston continue to push for rent control, the Boston Herald is calling for the city to treat landlords as allies for solving the city’s affordable housing crisis. Treating housing producers as allies means removing the restrictions and controls that stifle housing production.
Fundamentally, the housing crisis is a supply shortage. There are only two solutions to a supply shortage: 1. Decrease the demand, or 2. Increase the supply. The demand for affordable housing will not abate any time soon, which means the supply of housing must be increased. Housing producers, not politicians or housing activists, are the only ones who can increase the housing supply. In order to do that, they must be free to produce as they judge best.
Rent control does not increase the supply of affordable housing. Rent control does not decrease the demand for affordable housing. Instead, it creates disincentives to produce and maintain housing by imposing controls and restrictions on housing producers.
Intellectual honesty demands that anyone seriously interested in solving the affordable housing crisis recognize the fact that America has a supply shortage of affordable housing. To do otherwise is to ignore a basic law of economics, i.e., supply and demand.
When the price of eggs skyrocketed after an outbreak of avian flu decimated populations of laying hens, nobody suggested that price controls on eggs would increase the supply. Any credible commentator recognized that more production was required to drive down the price and make eggs more affordable. The same principle holds true for housing. More housing production is required to drive down housing prices.
If we don’t begin treating landlords as allies in the quest to make housing more affordable, we will see an exodus from the rental housing market. Instead of persecuting landlords, we should be celebrating them.