Here in SF the geniuses of the Lembi Group bought a bunch of apartment buildings on credit (something like 1 billion dollar's worth), used questionable/borderline illegal tactics to squeeze people out of rent controlled units, and then jacked the prices way up. Then the real estate bubble popped and they went bankrupt.
Lots of landlords are stupid and will raise rent beyond the market clearing rate just to make a quick buck, resulting in empty units and shitty communities.
No, actually it's rent control that gives way to that. Landlords don't rent at a loss, and prefer keeping their apartments empty, resulting in shitty communities, then squatters, etc.
Most economists believe that a ceiling on rents reduces the quality and quantity of housing available.[41][42] This view is based on analysis of empirical evidence as well as the understanding generated by theoretical models.[42] Economists from differing sides of the political spectrum, such as Paul Krugman[43] and Thomas Sowell,[44] have criticized rent regulation as poor economics which, despite its good intentions, leads to the creation of less housing, raises prices, and increases urban blight.
It probably works both ways, depending on exactly how low or high the rents are held. I've lived in some really, really nice areas that are rent controlled (SF Pacific Heights, Santa Monica, Downtown San Diego), apparently others have lived in relatively crappy neighborhoods where rent is also controlled.
Now that I think about it further, it seems obvious that rent control would be a tool that can be used by a municipality to control rents in either direction, depending on their goals.
