The Effects of Rent Control Expansion on Tenants, Landlords, and Inequality: Evidence from San Francisco
Rebecca Diamond, Tim McQuade, Franklin Qian
American Economic Review · 2019 · Volume 109 · Issue 9
Abstract
Using a 1994 law change, we exploit quasi-experimental variation in the assignment of rent control in San Francisco to study its impacts on tenants and landlords. Leveraging new data tracking individuals' migration, we find rent control limits renters' mobility by 20 percent and lowers displacement from San Francisco. Landlords treated by rent control reduce rental housing supplies by 15 percent by selling to owner-occupants and redeveloping buildings. Thus, while rent control prevents displacement of incumbent renters in the short run, the lost rental housing supply likely drove up market rents in the long run, ultimately undermining the goals of the law.
Keywords
Urban, Rural, Regional, Real Estate, and Transportation Economics: Regional Migration, Regional Labor Markets, Population, Neighborhood Characteristics, Housing Supply and Markets, Production Analysis and Firm Location: Government Policy
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