Mayor Michelle Wu is eyeing rent control as one solution to Boston’s housing problem. (Matt Stone/Boston Herald)
Boston has a housing problem: the supply is limited, the demand is great, and the rent is too damn high.
A new report shows that Boston ranked dead last among the nation’s ten largest cities when it comes to available rental units.
“The past year has unfortunately offered more of the all-too-familiar story of high prices, low vacancy rates, and systems and regulations that are keeping thousands of homeseekers – particularly non-White families – from accessing affordable rental housing and homeownership opportunities,” said Lee Pelton, CEO and president of the Boston Foundation, which released the report.
The report also showed that Boston is last among the nation’s largest cities when it comes to rental availability.
Anyone who’s tried to find an apartment in their price range here knows that all too well.
As the city works toward a solution, however, it can’t afford to treat landlords as adversaries.
Mayor Michelle Wu made another push for rent control last week, as the Herald reported, submitting written testimony ahead of a Joint Committee on Housing session at the State House.
Wu’s home rule petition for rent stabilization would cap Boston’s year-over-year rent increases at 6% plus consumer price indexes, to a max of 10%.
“This would allow tenants to have reasonable expectations of the increases in their living expenses and allow them to plan accordingly,” Wu wrote.
Would landlords’ costs be capped as well, or are they expected to eat the cost of stagnant rental income going forward? Will the city cap property taxes? And does the rent control bid include a proviso that costs incurred for maintenance and upkeep on rent-controlled units are waived?
Landlords run a business, like any other. Boston should want to attract such businesses to the city, not penalize them for operating here.
What is the incentive for the landlord of rent-controlled units to keep operating and not cut their losses by selling the apartments as condos?
According to Wu, owner-occupied properties with six or fewer units, as well as all new construction for the first 15 years after they receive their certificate of occupancy, would be exempt from the potential rent control policy. That leaves about 55% of the city’s rental properties subject to rent stabilization.
This puts housing developers on notice: build new units in Boston and you’re fine for 15 years, after that, you’re subject to rent control. Why would a developer make such an investment in the knowledge that in 15 years their returns will hit a wall?
Massachusetts had rent control before, and one thing was clear: tenants who lucked out on these units held on to them for dear life, often while their salaries increased and they could afford pricier places. Rent control doesn’t help market turnover.
If Boston is serious about wanting to increase housing stock so that rents stabilize and fall from an increase in supply, it must do all it can to make construction a winning proposition for developers.
Tax abatements are a good start.
Boston, and other cities considering rent control, should treat landlords and developers as valued businesses and allies on the path to solving the housing crisis.