Rent control can decrease the supply of housing from "summary" of Basic Economics by Thomas Sowell
Rent control can decrease the supply of housing in several ways. When the government imposes rent control, it puts a ceiling on the amount that landlords can charge for rent. This may seem like a good idea to help lower-income tenants afford housing, but it can have unintended consequences. One consequence is that landlords may have less incentive to maintain or improve their rental properties. If they cannot charge higher rents to cover the cost of repairs or upgrades, they may choose to let their properties deteriorate. This can lead to a decrease in the overall quality of housing stock available to renters. Another consequence is that rent control can discourage the construction of new rental housing. If landlords cannot charge market rates for rent, they may be less likely to invest in building new rental units. This can result in a shortage of available housing, especially in high-demand areas where rents are already high. Furthermore, rent control can lead to a mismatch between supply and demand. When the government artificially limits the price that landlords can charge for rent, it distorts the market. This can create long waiting lists for rent-controlled units, as well as vacancies in uncontrolled units where landlords can charge higher rents.- While rent control may initially seem like a solution to help lower-income tenants afford housing, it can actually have the opposite effect. By decreasing the supply of housing, it can exacerbate shortages and lead to a decrease in the overall quality of available rental properties.
