Housing experts debate effectiveness of rent control and state intervention

Economists and experts are debating whether rent control and state intervention can effectively address the housing crisis. Analysis suggests that while rent regulations may lower costs for some tenants, they often lead to a reduced housing supply, decreased property quality, and lower investor interest.

Sebastian Stodolak, Vice President of the Warsaw Enterprise Institute, notes that excessive state interference can have counterproductive effects. He cites New York as an example where rent controls have led to a lack of investment in existing housing. Conversely, he points to Argentina, where President Javier Milei’s decision to lift rental restrictions reportedly doubled the available rental stock.

In Poland, state programs like ‘Bezpieczny Kredyt 2 proc.’ have been criticized for potentially driving up housing prices rather than increasing supply. Research from the London School of Economics supports the idea that purchase support programs can inflate prices without significantly increasing the number of homes. Experts suggest that deregulation and administrative improvements, such as the digitalization seen in Malaga, may be more effective at increasing housing availability.