The Biden-Harris proposal for rent caps seems to be resonating, as a new survey from Redfin (NASDAQ:RDFN) found nearly four of every five respondents agreeing there should be caps on the amount landlords are allowed to increase rent.
The survey was conducted by Ipsos in September from a base of 1,802 renters and homebuyers aged 18-65. In the survey, 86% of respondents who identified themselves as Democrats believed there should be caps on the amount landlords are allowed to increase rent, compared with 79% of respondents who identified as Republicans. More renters (86%) than homeowners (78%) supported rent caps.
Redfin also noted that nearly four of every five respondents who live in California (78%) believed there should be caps on rent increases. California’s Tenant Protection Act prevents landlords from raising rent more than 5% plus the increase in cost of living each year. Next month, California voters will decide on a proposition that would allow cities to unilaterally expand rent control without state approve.
For its part, Redfin was not supportive of rent caps.
“Rent control sounds appealing for renters in theory because it limits price increases and saves money in the short term, but it eventually worsens rental affordability because it exacerbates the supply shortage,” said Chen Zhao, Redfin’s economic research lead. “If rent increases are capped below the amount developers would need to make a profit, they have little incentive to build more apartments and homes. The best way to make rentals more affordable is to build more units.”
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