Sanders’s discussion of his proposal doesn’t offer any explanation for how he arrived at the conclusion that the basic CPI+1 formula strikes an optimal balance and certainly not an explanation of why he thinks it makes sense to allow larger inflation-adjusted rent increases any time inflation drops either above or below the Fed’s target.īy the same token, while his plan does call for imposing a “just cause” requirement on evictions, there’s no language in the proposal protecting tenants from being displaced by landlords taking advantage of the capital improvements provision. Recently, however, inflation has actually tended to run below the Fed’s 2 percent target, which under Bernie’s proposal means landlords would get a kind of minor windfall based on an unrelated monetary policy error.īut if the error went in the other direction instead and inflation went up, landlords could reap an even larger windfall - 10 percent annual inflation would allow for increases of 1.5 times 10 - 15 percent, or CPI+5 just like in California. The Federal Reserve is supposed to be aiming for inflation to average 2 percent over the long term, under which case Bernie would be capping rent increases at 3 percent - or 1 point over the rate of inflation. Sanders’s plan is much more stringent than that. California earlier this summer enacted a similar law with a CPI plus 5 percent cap. Oregon, for example, passed a law capping rent increases at CPI plus 7 percent per year. Most new rent regulation proposals limit rent increases by some fixed amount above the overall rate of price inflation. And, more broadly, if you’re instinctively suspicious of market economics and the profit motive, Sanders cues into those values.īut the longer you think about how this is supposed to actually work, the more questions you’ll have. If that’s your situation, Sanders delivers for you. Lots of people are perfectly happy staying where they live, and they’d like to see the neighborhood get nicer without paying higher rent. Other policy ideas that Democrats (including Sanders) have embraced, such as creating new housing supply through either public investment or regulatory reform, don’t have that quality. If you are a person who is currently renting and has no particular plans or desire to move, Sanders is giving you considerable insurance against the possibility of rent increases in your neighborhood - and if the neighborhood does become considerably more desirable and expensive over the next 10 years, you’ll end up inhabiting an apartment for considerably less than the prevailing market rent. The one small concession to the complexities of real life is the plan will “allow for landlords to apply for waivers if significant capital improvements are made, which will incentivize landlords to improve the conditions of their properties.”Īnd while there are a lot of problems with this proposal, it also carries a very clear set of benefits. There are none of the exceptions for vacant units, small-time landlords, new construction, or other lacunae that tend to sneak into these laws in places where they’ve been written. Annual rent increases will be capped at either 3 percent or 1.5 times the consumer price index (whichever is higher). The Sanders rent-control proposal is mercifully simple compared to most real-world rent regulations. Sanders proposes a 3 percent cap on rent increases This is, more or less, how Sanders likes to roll - flagrantly brushing aside wonkish worries that would get in the way of framing a good-versus-bad story and eager to attract criticism from technocrats that only serves to underscore his image as a unique scourge of the establishment. As is typical for Sanders, his rent-control proposal is much more sweeping and stringent than anything that’s been implemented anywhere, and it has some technical flaws. And like a somewhat surprisingly wide array of Democrats this cycle, he calls for reforming zoning rules to allow for more construction in the priciest neighborhoods and markets.īut Sanders also stands out from the pack for his embrace of rent control, a long-out-of-style concept that’s making something of a comeback in liberal states. Like Elizabeth Warren, he calls for a huge investment in building and maintaining subsidized housing units. Kamala Harris and Cory Booker have proposals that would accomplish something similar). Like former US housing secretary Julián Castro, he calls for fully funding the Section 8 housing voucher program (Sens. ![]() ![]() Many of the elements of Sanders’s “ housing for all” agenda have clear echoes in other candidates’ proposals. Bernie Sanders, who released an expansive affordable-housing agenda Tuesday, is no exception. ![]() Democrats have rediscovered housing policy as a topic in the 2020 campaign cycle in a big way, and Sen.
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