Will Florida Embrace Rent Control? – The American Conservative

Florida Governor Ron DeSantis and the Florida state legislature have an opportunity to act decisively against the worst housing intervention: rent control. In the last election, a highly disputed rent control measure passed in Orange County, driven by activists from Orlando. While Florida already preempts local governments from imposing price controls on housing, there is a loophole allowing jurisdictions to impose such restrictions if there is a “housing emergency.” What constitutes a housing emergency is now being adjudicated by the courts in Florida, but action by the legislature could settle the issue by closing the loophole. 

First, it’s worth covering the basics of rent control, which is essentially a price control. All price controls have the effect of disincentivizing production by limiting cost recovery and creating uncertainty about whether an investment will produce a return. At its heart, every attempt to control prices – whether of rent, fuel, or otherwise – is a rejection of the price system, explained by economists such as Friedrich Hayek. The price system is a core tenet of classical liberal economics: prices are a signal that prompt changes in behavior. If prices rise, investors see an opportunity to develop products at a competitive price. The resulting efficiency is a product of innovation and ingenuity, and inspires more production. 

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I’ve written extensively about the almost universally accepted negative effects of rent control on the housing market. Yet it is still a bedrock tenet for many progressive housing advocates. Housing markets with the highest prices, like San Francisco and New York City, have had rent control measures in place for decades, yet these cities are always at the top of the list of cities with the highest rental costs. In the end, rent control does nothing for people who earn less money

The original article can be found here