Paul Hogarth writes a strange saga trying to justify the distortions and unfairness that rent control laws cause. He barely addresses the attacks that have been leveled at the Rent Board for ending the option of rent-free bonuses.

Contrary to what was reported in Wednesday's Daily Californian ("Rent Board Revises Law to Close Loophole," Feb. 19), the Berkeley Rent Stabilization Board did not respond by outlawing "signing bonuses" for tenants who sign a new lease. Instead, we passed a regulation that prevents landlords from reporting a higher rent ceiling to the Rent Board than what is actually being rented on a monthly basis. (Landlords were doing this so they could later jack up the rent when the market rebounds.)

Is that true? If so, it should lead to Daily Cal Corrections. It's not the point of his column, anyway, the majority of it being a broad defense of Rent Control.

Is it wrong that students and other new renters pay higher rents than long-term tenants? Absolutely. But it's not because of Berkeley's rent control or pro-tenant politicians. On this one, the landlords only have themselves to blame.

Why is it wrong? Students have higher costs then long-term residents: high turnover leading to periods when the apartment is filled being the main one. They're willing to pay a higher premium for apartments closer to campus. In addition, they entered the market when demand was higher then it was for the long-terms. To say that it would be wrong for them to pay higher rent in a higher demand situation is no different then saying it would be wrong for them to pay lower rent then long-terms in a low demand situation.

That's because landlords were not allowed to raise the rent when an apartment became vacant. They also had no incentive to leave the apartment empty because unlike today, they could not wait for one wealthier tenant to outbid the rest.

They had plenty of incentive to leave it vacant.. those many 'marginal' apartments were taken off the market as inflation and costs of maintenance rose but rents stayed the same. (Unless they got 'permission' to keep profits the same as in the arbitrarily chosen year of 1980.) In any case, the rent situation described most recently is of stable or declining rates, with landlords given the incentive to fill it as soon as possible.

In the end, Mr. Hogarth is blatant about seeking economic protection for students and punishing landlords for trying to run a business. The results will be the same as last time: housing units taken off the market, costs inflicted on students through declining maintenance and repairs, and even less housing being built.

Econ 1 with Professor Brown uses Rent Control as the classic example of market distortion with unintended negative consequences. It's worth a look.Email This Post!