What to Do When the Rent is Too High?

The average sales price of a home in the United States decreased following the 2008 Financial Crisis, reaching a low in early 2009. The average price of an American home more than doubled since—a 4.4 percent annual growth rate. During the same period, the average monthly cost of renting a primary residence in American cities increased at a rate of 3.5 percent, outpacing the overall goods inflation rate of 2.6 percent. Some of the nation’s largest metropolitan regions—including Minneapolis, Chicago, New York, and Washington, D.C.—saw annual rent increases of 8 percent or higher. Across income levels, American consumers include housing costs among their top financial concerns.

Rent-control refers to several related government policies intended to place limits on how much landlords can charge in rent. Such policies are sometimes proposed as a means of making housing more affordable. The number and type of units subject to these rules vary by jurisdiction, depending on factors like the age of the building, ownership status, or local exemptions. Several cities, including New York, San Francisco, and Washington, D.C., implement some form of rent control.

In the most recent presidential election, both candidates addressed voters’ concerns about housing costs, making the issue a core part of their respective platforms. Both also focused on reducing homeownership costs, emphasizing mortgage interest rates and new housing construction. In addition, the Democrats’ national platform outlined plans for a nationwide rent-control scheme.

The months since the presidential election marked a notable escalation in debate within state and local governments over rent-control initiatives. In June, Zohran Mamdani—who ran, in part, on a platform of freezing monthly rent costs across all existing rent-controlled units in the city—secured the Democratic nomination for the New York City mayorship. Days after Mamdani’s victory, the New York City Rent Guidelines Board, which sets prices for the city’s rent-controlled apartments, approved an increase of 3 percent to 4.5 percent for leases signed or renewed between October 2025 and October 2026.

The economic feasibility of rent-control divides economists. Some classical economists argue that rent-control distorts incentives, limiting supply through various mechanisms, including motivating landlords to convert inventory to owner-occupied condos for sale, not rent. Rent-control may decrease landlords’ incentives to maintain apartments and can, therefore, cause units to fall into disrepair. If rent control policies lead landlords to increase their standards for new tenants, such policies may limit tenant mobility. Similarly, below market rents may encourage rent-controlled tenants to remain in their apartments even when they no longer match their housing needs. Some economists suggest, however, that recent empirical data undermine many of the theoretical arguments against rent-control. These scholars argue, therefore, that the targeted benefits of rent control policies outweigh the negatives.

In this week’s Saturday Seminar, legal scholars and economists explore the implications of rent-control regulations, assessing impacts on housing supply, affordability, and social outcomes, and analyze the constitutional considerations underlying these policies.

• ​Sam Spiegelman, a practitioner with the Citizen Action Defense Fund, writes in an article in the Fordham Urban Law Journal that rent‑control burdens property owners, distorts markets, and erodes constitutional protections afforded by the Takings Clause. Spiegelman demonstrates that courts increasingly defer to legislatures. Spiegelman argues that rent-control allows legislators to offload the costs of housing policy onto a small minority—landlords—shielding voters from the burdens of broader, tax-financed programs like social housing. He contends that the Supreme Court’s recent property‑friendly jurisprudence offers a chance to simplify constitutional takings tests and more fairly distribute the costs of housing policy. Spiegelman therefore urges the justices to strike down rent caps and various eviction limitations, encouraging legislatures to pursue affordability through transparent, traditionally tax-financed, market‑neutral programs that balance benefits for tenants and taxpayers alike.
• Tom Stanley‑Becker of Georgetown University Law Center, in an article in the Georgetown Journal of Law & Public Policy, argues that eviction limitations, often passed in conjunction with rent control policies, do not amount to government seizure of property without compensation and, therefore, do not violate constitutional protections against uncompensated takings. Stanley-Becker explains that, because landlords voluntarily open their property to tenants and can still reclaim possession of their apartment after proper notice, the constitutional right to exclude others from one’s property remains intact and, therefore, no taking occurs when eviction limitations are enacted. He warns that treating eviction restrictions as takings which require just compensation would upset decades of legal precedent upholding renter-protection laws, fair‑housing rules, and certain public‑accommodation laws. Instead, Stanley-Becker advances a view of rent control policies as proportional bargains that safeguard vulnerable tenants, preserve community stability, and respect long‑standing federal legal precedent.
• In an article in the Journal of Housing Economics, Konstantin Kholodilin of the German Institute for Economic Research examines evidence from over 100 empirical studies on rent-control and highlights adverse effects that may offset the benefits of rent control. Kholodilin notes that rent control is often implemented along with other tenant-friendly policies, complicating economic analysis. Still, Kholodilin highlights several studies indicating that rent control policies effectively lower rents for regulated units, providing short-term affordability. Kholodilin also finds rent controls likely reduce the expected return on investment for purchased properties, lowering investor demand and potentially easing pressure on other buyers. Kholodilin, however, identifies significant adverse effects, including reduced housing supply, fewer construction starts, less mobility, lower rental quality, and more tenants renting larger apartments than they need.
• In their working paper, Christina Plerhoples Stacy of the Urban Institute and several coauthors evaluate the effects of rent control policies on rental housing availability at various levels of affordability. The Plerhoples Stacy team finds a net decrease in the total number of rental units within a city after the introduction of rent control policies. Plerhoples Stacy and her coauthors also note an increase in the number of units affordable to extremely low-income households, and a decline in units affordable to higher-income groups. Their findings suggest that, although rent control can effectively increase affordability for the lowest-income renters, policymakers should carefully weigh these benefits against potential long-term reductions in the supply of rental units for middle and high-income renters.
• Brandon Weiss, a professor at American University Washington College of Law, argues in a recent article in the Washington University Law Review that the growing number of corporate landlords warrants federal intervention through a nationwide rent control policy. Weiss documents how corporate ownership of rental housing has transformed the landlord-tenant relationship through increased eviction rates, anonymous ownership structures, and algorithm-based prices. He urges Congress to authorize national rent regulations like those implemented during World War II and the 1970s. Weiss argues that Congress alternatively could encourage states to adopt rent stabilization by conditioning federal housing funds on tenant protections. Weiss concludes that federal action is necessary to ensure housing security as corporate landlords increasingly dominate rental markets across jurisdictions.
• In a recent article in Urban Studies, Christopher B. Goodman of Northern Illinois University and Megan E. Hatch of Cleveland State University find that state-level efforts to override or block local housing policies—known as preemption—are driven primarily by legislative ideology rather than interest-group pressure. Analyzing data on state preemption of inclusive zoning, rent control, short-term rental regulation, and income anti-discrimination laws, Goodman and Hatch demonstrate that conservative legislatures are significantly more likely to preempt local housing policies. They also find that legislatures in states with higher percentages of renters are less likely to preempt local rent control initiatives. Goodman and Hatch conclude that state-level preemption limits municipal and local policy options for addressing the affordable housing needs of their constituents.