PROVIDENCE – Rent control could reduce the number of available rental units in the city and push more costs onto homeowners, according to a new study from The Providence Foundation and the Rhode Island Public Expenditure Council.
Released Thursday, the report analyzed housing policies nationwide and found that rent control often fails to make housing more affordable, while also discouraging new construction, prompting condo conversions and reducing property tax revenue.
The study found that rent caps often favor higher-end units, giving tenants in expensive apartments much bigger savings than those in modest rentals. Housing production can plunge under price caps, the study found, while noting in St. Paul, Minnesota, multifamily permits dropped 86% in just one quarter.
Rent-controlled units can also face maintenance issues or be converted to condos, as what happened in San Francisco and New York City, and local tax bases can shrink, with Portland, Maine, experiencing a 5.4% drop in property tax revenue, according to the report.
“Getting housing right is paramount,” said David Salvatore, executive director of The Providence Foundation. “Rental control has been found to be a flawed policy in cities across the country.”
Instead, the report recommended supply-focused reforms, such as zoning changes, direct rental assistance, and incentives for commercial-to-residential conversions - approaches that have produced measurable results in Boston, Philadelphia and Austin, Texas,.
“While rent control carries serious negative consequences, there are alternative, evidence-based policies that could be implemented to address the city’s housing needs,” said Michael DiBiase, CEO and president of RIPEC. “Increasing housing supply and implementing direct, means-tested financial assistance to renters have been successful in communities across the country. The more options renters have, the more rents will stabilize.”
Salvatore added, “Leaders across the city all want housing to be more affordable. However, it’s clear that rent control is not the way to achieve this goal. We must work together to increase the number of units across the city in order to make housing more affordable.”
The Providence Foundation, which represents more than 140 business and nonprofit leaders, said the report will inform ongoing policy discussions aimed at stabilizing rents and expanding housing options for Providence residents.
Matthew McNulty is a PBN staff writer. He can be reached at McNulty@PBN.com or on X at @MattMcNultyNYC.
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