Rent controls generally fix the price of rental housing below market equilibrium. Economic analysis suggests these controls
A) are effective in helping the poor find housing.
B) improve the quality of housing available to consumers.
C) create a surplus of rental housing.
D) reduce the future supply of rental housing.

Question

Quizplus · Accepted Answer

Rent controls reduce the amount of profit landlords can make on rental units, which leads to a reduction in the supply of rental units in the long run. Landlords will be less likely to invest in or maintain rental properties, which can result in a decrease in the quality and quantity of rental housing available. Therefore, rent controls reduce the future supply of rental housing.

Rent Controls Generally Fix the Price of Rental Housing Below