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News & Views of Phillips Since 1976
Thursday June 20th 2024

Are rent increases based on costs, demand, or greed?


It was fun to watch the powers that be quickly scramble to mount an attack against rent control after Senator Bernie Sanders said he would implement a 3% national cap on all rent increases if he is elected.

Within days of saying it, the Star Tribune and the Pioneer Press ran anti-rent control editorials.

The “experts” that are quoted in those editorials have only one thing in their “tool boxes” to justify capitalism as a way to provide housing””“Hang in there renters, as we build more housing, rents will stabilize.” This is nonsense. New York is proof; where rents have been high and continue to get higher in New York City and this has been going on for fifty years there. Is not 50 years enough time to build enough housing to stabilize rents?

The only way capitalism works for providing housing is to purposely not build enough housing and then charge more and more for housing which then stimulates construction. Capitalism purposely never catches up with enough housing. How can China, a country of 1.25 billion people provide enough housing and the U.S. with only 330 million citizens cannot?

Now that the new tenant screening ordinance has passed, Minneapolis landlords are threatening to raise rents even more, to cover the costs of taking on “risky” tenants. But how can that be trusted, since over the past five years they have been raising rents on tenants who were not risky?

Stop playing games landlords. Everyone knows that rents do not go up based on landlord expenses. If rents went up with landlord expenses, then you would have to conclude that landlords in Uptown, every single one of them, have the highest operating costs of all landlords in the City.

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