Its due to gov rent control policies. Areas where rent control policies are minimal, or don't exist, housing has risen, but not nearly as much as areas like NY or CA. Houston has actually done a really good job of keeping housing costs low due to allowing building of new units, i.e. increasing supply to meet demand.
I have no idea how people keep blaming "capitalism" and "free markets" for the housing issues when it's one of the most regulated areas of the economy. Areas where housing is in a more free market are more affordable.
Correlation does not imply causation. Why would rent control - policies explicitly limiting the cost of housing - cause prices to increase? I would argue a for more likely explanation is that high rent prices cause increased pressure on the government to institute rent control. The prices in 'high value' areas, like NY or CA, would be even higher without rent control.
I'm currently paying $1100 for a two bedroom apt in MN. The main reason it's not higher is that very few people want to live in MN, especially here.
Correlation doesn't imply causation all the time. But when the pattern is rent controlled cities/states being consistently higher than non-rent controlled cities/states, that's compelling evidence.
Your own experience in MN bears this out. Demand is low, so there is some supply that keeps prices low. My area has seen an explosion in housing construction. And though housing costs have risen, it isn't as bad as in major metro areas. I pay under $2k for a 4 bedroom, 3 full bath house on 0.5 acres. That includes my taxes and insurance.
There are several issues with your argument. First, you provided no new arguments - you just repeated your first argument. Second, the pattern you describe is just correlation - you haven't eliminated the other possible relationships. In fact, my argument is that there is causal relationship - just in the other direction. You have not explained why rent control could cause higher rent.
The laws of supply and demand (which you referenced relative to my own experience), suggest that because demand is higher in large cities, prices will be higher. That's just the free market - rent control has nothing to do with it.
I hadn't really read up on what rent control policies actually look like. See https://rentguidelinesboard.cityofnewyork.us/resources/faqs/rent-control/ for the basic research I've done, but the important point is this: rent regulations only apply to some, but not all apartments. Based on the numbers in that article, and this one (www.nyc.gov/content/tenantprotection/pages/fast-facts-about-housing-in-nyc), only about a third of apartments are under any form of rent control. In other words, about two thirds of apartments in New York are not rent controlled, and thus their rent is set via the free market. Therefore, the overall high rent cannot be caused by rent control policies.
Also from the first article I linked, 'The system was enacted in 1969 when rents were rising sharply in many post-war buildings' - In other words, rent control was enacted after the free market increased rent prices. This was the argument I made in my last comment - that rent control is typically a response to high rent, rather than a cause of high rent.
Finally, I've never heard a landlord that's in favor of rent control. Landlords have a financial incentive to increase rent (they get more money), so if rent control caused an increase in rent, they would absolutely be arguing for more rent control.
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u/DaKrakenAngry Jun 21 '25
Its due to gov rent control policies. Areas where rent control policies are minimal, or don't exist, housing has risen, but not nearly as much as areas like NY or CA. Houston has actually done a really good job of keeping housing costs low due to allowing building of new units, i.e. increasing supply to meet demand.
I have no idea how people keep blaming "capitalism" and "free markets" for the housing issues when it's one of the most regulated areas of the economy. Areas where housing is in a more free market are more affordable.