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Economic & Financial
Insights
Ara
Inefficiencies of Rent Control and Mortgage Interest Rate Subsidies in Housing Policy
This paper analyzes the inefficiencies of rent control policies and mortgage interest rate subsidies in housing markets. Study mainly argues that while these policies aim to improve short term affordability, they often distort market dynamics by increasing demand without addressing supply constraints. Rent controls reduce housing quality, discourage new housing supply and raise rents in uncontrolled segments.
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