The Awkward Pose

The Joint Housing Committee of the Massachusetts Legislature recently held a virtual hearing on House Bill H.1378, a proposal to grant cities and towns the right to establish rent control. As a person who lived in a rent control apartment, then owned rent-controlled apartments, and now owns unregulated apartments, I have broad experience of the issue. This series explores the potential, and pitfalls, of rent-control as a mechanism to address our housing supply and affordability crisis.

Link to Part One—Legal History

Link to Part Two—Personal History

Link to Part Three—Prognosis

Better Options to Addressing our Housing Crisis

The knee-jerk reaction to addressing our housing crisis is simple: build more housing. That is certainly part of the solution. But a comprehensive and sustainable approach to ensuring housing for all must also include: create different housing. Different types of housing, different size housing, different arrangements of groups sharing housing.

Over the past seventy-five years, the average size of a home in the United States has more than doubled, while the average family size has shrunk. Most of us occupy more square feet than our parents, and magnitudes more than our grandparents. Space that we must heat and cool and furnish. Space that, despite stricter energy codes, consumes an unsustainable amount of fossil energy. We cannot construct housing for all without structural changes to the way we conceive and deliver housing, because the lion’s share of housing we create is simply gobbled up by the ever more affluent end of our population, while bottom dwellers are denied access.

The atomization of our housing fuels another problem plaguing our nation: the mental health of loneliness. Twenty-five percent of us live alone. A direct result of an affluent society that celebrates autonomy. Yet, humans are social creatures. For all we crave independence, isolation is unhealthy.

I began researching this series, “On Rent Control,” with an open mind as to whether Massachusetts should reenable rent control. However, the more I read, the more I understood that rent control provides housing security for a select few at the expense of others. Its most tantalizing attribute is political: the illusion equity without public cost.

There’s no value in denigrating one approach to providing affordable housing without offering options in its stead. And so, I offer this smattering of ideas that, collectively, could actually alleviate our housing crisis. They fall into two main threads: First, opportunities that require public resolve without large public expenditures. Second, opportunities that require public resolve—and public money.

Increasing Housing Stock and Affordability without Large Public Expense

Some of these ideas have been around awhile; others may be new. Some tread on existing rights of property owners, but no more than rent control does.

1. Zoning Reform. The first, most obvious, and most impactful way to create more housing, and more affordable housing, is zoning reform. Zoning’s noble roots as a means to ensure public health have been coopted to protect property values. We should abolish all single-family zoning. We should enable auxiliary units in existing buildings, or in fresh outbuildings. We should reduce parking requirements to allow greater density.

Zoning reform would actually cost less than instituting rent control. No need to create the bureaucracy of a Rent Control Board; zoning review boards already exist. In addition, rather than simply regulating existing dwellings, looser zoning would actually create new dwellings.

2. Inclusionary Zoning. Maintain, and possibly expand, inclusionary zoning. Since Cambridge is a desirable place to develop, the city currently requires 20% of residential units in new buildings to be ‘inclusionary.’ (i.e. rented to people of moderate income). Although inclusion does not serve low-income people, it is a welcome and integrated form of subsidizing moderate income housing. Can we boost it to 25%? Will the developers still come at that threshold? I think so.

3. Shared Housing. Create more generous forms of shared housing. In a college town like Cambridge, shared housing can have a bad name. Nonetheless, it exists. Current zoning defines four or more people living together as ‘group housing’, with different requirements than a single-family unit. Group housing should be better defined, more easily organized, and given inducements, so that four, five, six, even eight people can live legally and cooperatively.

4. Housing Match. Instead of creating a Rent Control Board, how about a Housing Match Board? Cambridge is full of people, mostly elderly, who have extra room. They might welcome an additional person living with them, whether for assistance, income, chores, or just companionship. Craigslist and NextDoor provide ways for individuals to trade goods and services, but don’t offer the kind of vetting that someone seeks before they welcome another into their home. What if the city developed guidelines to define and match these opportunities?

5. Legislate and/or Tax Dwelling Units Taken Out of Service. If it can be legal for the city or state to establish maximum rents on privately owned property, why not consider other, more generative forms of controlling existing housing stock? Every block of my Strawberry Hill neighborhood has two family houses that have been converted to single-family, as well as two-family houses where the owners no longer rent their extra unit. In a city short of housing, do owners of multi-family buildings have a responsibility to rent them? Can the city restrict conversions that reduce the total number of dwelling units? At the very least, let’s levy a hefty tax on units taken out of service and allocate that money to creating new housing.

Increasing Housing Stock and Affordability through Public Measures

Regardless of zoning reform, inclusion requirements, and disincentives to take units off line, we are unlikely to address the problems of affordable housing for all our citizens though manipulating the parameters of private ownership. Some tenants will remain too poor; too challenging. Public interest in building and operating housing for people unable to participate in the private market has waxed and waned over the past century. But we have enough examples of doing it well that if we commit with purpose, and allocate the money required, we can house everyone.

1. Expand Section 8. The Section 8 program has many benefits, primary among them that it integrates tenants in the fabric of existing community. Section 8 does not increase the amount of housing per se, but offers access to more units for low-income people.

2. Build more affordable housing. Easier said than done. Whether through the Cambridge Housing Authority or local non-profits, we need more fully affordable housing projects. The recent 100% Affordable Overlay Zone is a good step in this direction. Now, we just have to pony up funding.

3. Build more alternative forms of housing. The private development market is not a forum for innovation. Developers only build what they know will rent: independent, full-service dwelling units. The more private amenities, the better. Publicly funded housing should move beyond creating warrens of individual apartments. We should use public resources to experiment with new, more sustainable and socially integrated forms: congregate housing where four-to-six-bedroom suites share common spaces; old school SRO housing in urban centers; even residential hotels where residents’ private suites come with chits to local restaurants or a subsidized dining room. All options that provide housing for single or coupled people in less space. All options that encourage people to be out and about. All options that, if proven successful, the private market will emulate.

No one of these suggestions will solve our housing crisis. Given our culture of uber-privacy, I doubt many will be realized. The American mania for autonomy baffles me. I’ve lived with other people my entire life, as family, spouse, or housemate. I find the tremendous benefit in having someone nearby—accountable for and accountable to—offsets the downside of, like, having to get along with someone else on a bad day. Besides, living among others is more sustainable, more affordable, and more sociable.

Our housing crisis is real. Implementing rent control is an easy feel-good that won’t really address the issue. This essay outlines eight other possibilities, none of which will resolve the problem in total, any of which can provide more housing, or more affordable housing, than rent control offers. The solutions I suggest—and there must be others—will be more difficult to bring forth than simply rechurning rent control.

Do we have the resolve required to rise beyond an approach already tainted, and implement real change in how we will live and how we will care for our fellow humans?

The Joint Housing Committee of the Massachusetts Legislature recently held a virtual hearing on House Bill H.1378, a proposal to grant cities and towns the right to establish rent control. As a person who lived in a rent control apartment, then owned rent-controlled apartments, and now owns unregulated apartments, I have broad experience of the issue. This series explores the potential, and pitfalls, of rent-control as a mechanism to address our housing supply and affordability crisis.

Link to Part One—Legal History

Link to Part Two—Personal History

Can Rent Control Help to Address our Housing Crisis?

Social assistance programs transfer resources from one group in society to another. Our reasoning for these transfers falls into two basic camps. First: all humans are entitled to basic food, shelter, and healthcare (thus: food stamps and Medicaid). Second: we attempt to balance opportunity and access in an inherently inequitable society (thus: higher education Pell Grants and set-asides for minority businesses). Ultimately, every social program debate can be reduced to whether something ought to be taken from Peter to benefit Paul. Since I believe everyone is entitled to the basic requirements of life, and that we should attempt to balance the inequities of our world, I support both approaches.

There are also two fundamental ways in which resources are redistributed. They’re either ‘targeted’ by need (again, food stamps and Medicaid) or ‘universal,’ equally distributed across the entire population (the recent Economic Impact Payments). Both forms of redistribution are valid, though each achieves different purposes.

To assess whether rent control is a worthwhile social program, let’s consider whether it helps fulfill a basic human need and/or balances inequities of our society; and whether it’s ‘targeted’ or ‘universal.’ The studies and statistics I reference are from, “Rent Control: What Does the Research Tell us about the Effectiveness of Local Action,” a white paper published by the Urban Institute (January 2019) and “America’s Rental Housing 2020,” by the Joint Center for Housing Studies.

Does rent control help fulfill a basic human need?

At first glance, the answer to this question is yes: rent control provides secure housing because it remains affordable to tenants over time. However, evidence indicates that rent control dampens the development of new housing. Thus, while it provides security for residents of rent-controlled units, it hinders the total amount of housing available.

Does rent control help to balance the inequities of our society?

In 1994, when Cambridge lost the ability to enforce rent control, 26% of people living in rent-controlled units were in the bottom quartile of income; while 30% of rent control residents were in the top half. At first glance, it appears beneficiaries of rent control at least parallel economic strata.

However, lower income people are more likely to rent than own. Over 40% of families in the bottom quartile rent, so if they claim only 26% of rent-controlled units, they are actually underrepresented. Since rent control doesn’t include income guidelines, and since most landlords will be predisposed to higher income tenants (as I am), logic follows that proportionately fewer low-income families will benefit.

If we include income guidelines into rent control, the program could better balance inequity. Unfortunately, this would usher in a new set of challenges. How would we monitor income eligibility? If a family’s income rose above a certain threshold, would they have to move out? Would this be reverse discrimination against people whose income exceeds the guidelines, as they would have less access to the pool of available rental units? Providing means tests to rent control would enhance the claim that rent control provides more affordable housing for those who need it. But the means are thorny.

Is Rent Control ‘targeted’ to a particular group?

As long as rent control does not include a means test, the only group it targets is renters as opposed to owner-occupants. Although renters, in aggregate, are less affluent than home owners, there are plenty of renters who don’t fall within most governmental definitions of ‘need.’ In fact, people who live in rent control apartments are statistically older, single, and childless when compared to renters overall. Again, the beneficiaries of rent control do not neatly align with groups in need of assistance.

Can Rent Control be applied universally?

The answer to this is: definitely not. Rent Control is limited by the number of units available to control, not the number of people who could benefit. It creates a new category of division in our cities: those who receive rent control, versus those who do not. A recent study in San Francisco estimated the economic ‘transfer’ of those living in unregulated units to those living in rent-controlled units is $2.7 billion per year. That’s a mighty big transfer to people who very likely landed their rent-controlled apartment through luck or connection rather than need.

If rent control does not meet the basic requirements of an effective social service program, why is Massachusetts considering enabling it (once again)? The answer is easy as it is illogical. Politics.

Enabling cities to establish rent control provides the illusion of doing something about our housing crisis at no direct cost. It costs the state nothing to pass the legislation. Cities who implement rent control bear only the cost of their operating boards. Politicians can say, “We made over 50,000 units in Cambridge more affordable,” without adding a single residential unit to our city.

Rent control is a politically expedient means to claim progress in our housing crisis, and a demonstrated path to creating a secure voting block among the lucky folks who wind up occupying rent-controlled units. State Senators, Representatives, and City Councilors know that the unlucky ones, who cannot find an apartment in Cambridge, won’t be voting in their district!

If rent control isn’t a panacea, how can we address the crisis of housing availability and affordability in Cambridge and beyond?

Tune in next week for…Better Options to Address Our Housing Crisis.

The Joint Housing Committee of the Massachusetts Legislature recently held a virtual hearing on House Bill H.1378, a proposal to grant cities and towns the right to establish rent control. As a person who lived in a rent control apartment, then owned rent-controlled apartments, and now owns unregulated apartments, I have broad experience of the issue. This series explores the potential, and pitfalls, of rent-control as a mechanism to address our housing supply and affordability crisis.

Link to Part One—Legal History

Rent Control and Me

My first experience with rent control came quick upon getting engaged. Time for me and my fiancé to move out of our respective group houses into a place of our own. Our budget was tight, apartments scarce. In July of 1979 we found a 425 square foot one bedroom on Mass Ave between Central Square and Harvard. Four tiny windows facing a blank wall. A measly abode in an excellent location for $224 per month. We signed a September first lease, confident that love would bind in such tight quarters. In the last week of August we received a notice from the Rent Control Board: the rent on our apartment was reset to $277. What the $#@**%. A 24% increase! So much for rent control, like, controlling our rent. We tightened our belt and winced every month as we wrote out the check.

Years passed, and the traditional single-family house always dangled beyond our financial grasp. We moved to Oklahoma City and purchased a two-family house in a place where no one’d ever heard of rent control. Moved back east in 1986 and purchased a two-family in Somerville, where rent control had already been terminated. By 1992, we had two children and decided to relocate along the Route 2 corridor: Lexington, Arlington, Belmont or Cambridge. I’m a city guy, but Cambridge was a long shot: houses were either super experience or, if under rent control, in shambles. Lucky us! We come upon an albatross: an asymmetrical four family with a large three-story unit attached to three flats. The sellers (SPOA activists) had legally subdivided the place down the party wall, but the communicating porches and cross-doors defied the simple line drawn on the paper deed. Our real estate agent proved a savvy negotiator, and we flipped from being out-priced seekers to mortgaged owners of a 5,000 square foot behemoth. Still, everyone wrinkled their brow at our stupidity: you bought a house under rent control?

The illogic of the system became immediately apparent. The smallest apartment, an attic studio, had the highest allowable rent, by a wide margin. The appraiser thoroughly investigated the side we would inhabit, but declined to even walk inside the rent control side. He explained, “The value of a rent control property is established by rents set by the Board; the actual condition is irrelevant.”

Within a week of closing, I received notice to appear before the Rent Control Board. I arrived in dress shirt and tie, clueless to the agenda. I was greeted as the enemy, with full bore skepticism and derision. “Why did this building get legally subdivided?” “How are you trying to circumvent rent control?” I knew that the rent control equation was a zero-sum game: the previous owner had subdivided a four-family building, in which one unit was owner occupied and three under rent control, into two legally separate properties. As the new owner of both properties, we would live in the ‘single family’ while the ‘three family’ would remain under rent control, since it was not owner occupied. The legal description of the property had changed; the de facto rent control status had not. This reality did not stop the Board from grilling me from every angle, convinced I was up to no good. I remained uncharacteristically calm; while they fumed.

The following summer my attic-studio tenant moved out. Within an hour of posting notice, I had three applicants. One was a single mother with a young child. The second, a single woman who planned to run an at-home day care out of the apartment, The third was a medical resident at Children’s Hospital. Since rent control did not demand a means test or other social criteria, I did what any conscientious landlord would do: rented to the person with the highest and most secure income. The medical resident proved to be an excellent tenant.

In the run-up to the 1994 state ballot initiative that ended rent control, local media was ripe with pro-rent control articles. One morning, the front page of the Cambridge Chronicle featured an article about the woes of a tenant who claimed “I will not be able to afford my apartment if rent control is eliminated.” The quote stuck in my throat. The subject of the article was my own tenant and no one— from the Chronicle or anywhere else—had asked me, her landlord, what her uncontrolled rent might be. I called the Chronicle, accused them of pandering, and lambasted their shoddy reporting. The following week, the cover page story featured me, explaining how small landlords valued continuity and would not necessarily toss out every tenant in the city.

For the last thirty years I’ve managed the three apartments attached to my own house. I am attentive and fair in the rents I charge and maintenance I provide. So far, I’ve only had one tenant to whom I have not offered an extended lease: the woman from the Chronicle article. I am disinclined to be generous toward people who malign me, even if indirectly.

My three apartments are safe and sanitary, yet hardly fancy. The rents I charge fall within the guidelines of HUD’s Section 8 rental assistance program. I could sign on for the program and be guaranteed tenants and rent. But I do not. I know how arbitrary HUD guidelines can be from my days designing affordable housing, and rumors surrounding the hassle of annual property inspections keep me from welcoming the housing authority into my 120-year-old building.

I am fully aware of the inconsistency in my behavior. I believe everyone should be entitled to basic housing, and I could provide truly affordable housing to at least a few people. Yet I steer clear of inviting government busyness into my affairs, and choose to rent to folks whose decent incomes don’t require subsidy.

My personal experience with rent control reflects a program that proclaims a set of benefits far different than what it delivers. If the state once again passes enabling legislation to allow rent control in Massachusetts, and if the City of Cambridge adopts it, of course I will comply. But we’ve already lived through one generation of rent control, and it failed to deliver affordable housing to those in need. I wonder: can rent control be structured to better align with our objectives, or are there are better ways to achieve stable housing for everyone?

Next Up: Can Rent Control Help to Address our Housing Crisis?