A rent freeze is not the answer
Sir, – When the majority of economists (a profession well known for divergence of opinion) agree that freezing rent creates shortages in the supply of new units and a deterioration in the quality of all others, we should take notice. And perhaps the Social Democrats have: in stating in their party’s rental charter that a nationwide rent freeze would be time limited, there seems to be an admission that rent-freezing might not be great public policy.
But if they and other supporters of a rent freeze believe it can be made temporary, they are only fooling themselves.
Experience from New York and Los Angeles, where similar measures were imposed, have shown that once a rent freeze is put in place, it is rarely reversed. The moment a rent-freeze Bill is signed into law is the same moment in which a powerful new interest group will come into existence: a national rent-control advocacy group. Renters are voters and it’s hard to imagine any politician risking their seat by opposing the extension of a national rent freeze. They say all prophecies are wrong but I envisage the consequence of nationwide rent freeze as follows: reduced supply, poor-quality units and an interminably prolonged housing crisis. Perhaps the very situation the political parties are promising to deliver us from? – Yours, etc,