Human Rights Commission calls for rent controls

December 10th, 2013 at 10:00 am by David Farrar

Stuff reports:

Capping rent prices in the wake of big natural disasters and a warrant of fitness on all rental properties are among (HRC) recommendations to the Government prompted by the Canterbury earthquakes.

The HRC today releases a report that considers the human rights challenges that emerged during the quake recovery.

The Human Rights Commission may have legal expertise but I don’t think they have economic expertise.

If you put  a freeze on rents after a disaster, then that will help ensure that new properties are not built and/or rented out. It will lead to even greated reduced supply and homelessness.

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29 Responses to “Human Rights Commission calls for rent controls”

  1. KiwiGreg (3,255 comments) says:

    Seriously you could do a lot worse then abolishing all government organisations with the word “Commission” in their name.

    Children’s, Family, Human Rights, Maori Language, Law, they are all fucking useless parasites.

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  2. In Vino Veritas (139 comments) says:

    That’s what you get when you charge a group of “do gooders” with responsibility to make rules and regulations.

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  3. Manolo (13,780 comments) says:

    Venezuela and Cuba here we come!

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  4. kowtow (8,487 comments) says:

    The “rights” industry is out of control.

    While its numerous and various proponents push their causes we are slowly but surely losing our most fundamental right, freedom.

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  5. greenjacket (466 comments) says:

    The other day it was the Childrens’ Commissioner making an ass of himself, today it is the Human Rights Commission… Why are taxpayers paying for these fools?

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  6. Nigel Kearney (1,013 comments) says:

    This has been tried elsewhere. It doesn’t necessarily lead to homelessness. What tends to happen instead is that the cap is circumvented by people paying bribes to the landlord. In NZ we don’t really have a culture of paying bribes but this seems like an effective way to get one going.

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  7. berend (1,709 comments) says:

    The Human Rights Commission can start their economic education by providing us a list of countries which have price controls. I’ve already seen some of those countries mentioned in this thread, so that will help them. It sure will be an enlightening exercise.

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  8. s.russell (1,642 comments) says:

    Rent controls would violate human rights by stealing the value of owners’ property, and removing their freedom over what they do with their own property.

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  9. berend (1,709 comments) says:

    In addition to Nigel Kearney’s comment: New York has price controls. So what happens is that you get “fees” instead of rent. One example is that you pay a few hundred dollars per month for the right to have a door key.

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  10. queenstfarmer (782 comments) says:

    Perhaps someone from ChCh can tell me, what was the situation here? (I ask to avoid having to read a 184 report ;-) )

    E.g. Did landlords attempt to jack up rents on existing tenants ASAP after the earthquakes? Or on new tenants moving back in to vacated property? Or both? Have they gone up gradually over time? In all Christchurch areas / certain areas only? etc

    Ta muchly.

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  11. OneTrack (3,107 comments) says:

    “Rent controls would violate human rights by stealing the value of owners’ property, and removing their freedom over what they do with their own property.”

    Socialists don’t care about private property rights. So, no problem to them.

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  12. MT_Tinman (3,187 comments) says:

    queenstfarmer rents in ChCh, as they do damned near everywhere else, recognise supply and demand.

    There will always be a few who take advantage of a situation and those who consider longer term outcomes.

    I’ve met some of the HRC people. This recommendation surprises me not.

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  13. burt (8,271 comments) says:

    When Dear Leader implements the glorious re-building of socialist NZ none of this will be a problem – we’ll all be in a queue for toilet paper, bread and housing will be something only the party elite enjoy. The socialists will call this success because land lords have been eliminated !!!!!

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  14. wreck1080 (3,917 comments) says:

    they should read freakonomics.

    Simple stuff.

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  15. wrightingright (143 comments) says:

    why the heck are they talking about the cost of renting? what next, the HRC is going to comment on what the price of food should be??? madness!

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  16. Manolo (13,780 comments) says:

    If only this quango and a few useless others were abolished by Labour Lite. If only!

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  17. Fletch (6,390 comments) says:

    The entire concept of “rent controls” and “affordable housing” is deeply rooted in socialist economic theory—pitting the “rich” against the “poor.” Rent controls (when the government arbitrarily sets the maximum price a private property owner can charge to a renter) are especially detrimental to the poor—exactly the opposite of what those on the left claim.

    Any government-mandated price ceiling for apartments will either result in contrived scarcities or reduced quality. That’s the only result when owners are forced to rent their properties for less than they’re worth. When owners’ rent incomes are less than what they owe in mortgage payments, taxes and other costs, they either sell their buildings or abandon them—something thousands of owners have done in New York and other cities which have rent controls.

    Rent controls—instead of providing more apartments and lower prices—actually end up decreasing the supply and quality. Why? Because when property owners lose profits as a result of controls, they are less able to invest in their properties. That means they don’t make necessary repairs or provide regular maintenance, which inevitably leads to property deterioration and abandonment.

    Housing policy expert William Tucker estimates 30,000 New York buildings per year were abandoned between 1972 and 1982 because of rent control—a loss of almost 350,000 apartment units.4 Paul Niebanck, a community planner and developer, concluded about thirty percent of rent-controlled housing in the U.S. has deteriorated, compared to only eight percent for apartments which rent at the fair-market value.5 Rent controls can also end up protecting rich tenants.

    Ed Koch, the former Mayor of New York City, benefitted from rent controls at the expense of poorer individuals who couldn’t find “affordable” rents.6 Since rent “controls” limit profitability by capping rents owners can charge, demand for new apartment buildings decreases and non-controlled dwellings—such as condos and luxury apartments— increases, causing excess demand and inflated prices. At the same time, those who can least afford expensive condos and luxury apartments face reduced availability of quality rental apartments.

    Rent controls violate fundamental free market principles. Even though the left likes to use non-threatening terms such as “humanitarian” and “helping the poor,” when making a case for rent controls, they are immoral. The government has no right to violate the rights of private property owners to decide what price they can charge for their own property.

    That type of intrusive coercion is more indicative of socialist-controlled economies than free market capitalistic ones. Both the prospective tenant and the apartment owner have the moral right to agree on a mutually acceptable price. They also have the moral right to disagree. While the left describes government intrusion into the private affairs of citizens as being “humanitarian,” it clearly violates the concept of economic freedom.

    Most economists (on both the right and the left) agree controls are generally bad. Right-leaning Nobel Prize winning economists Milton Freidman and Friedrich Hayak and left-leaning Nobel laureate Gunnar Myrdal are in unanimous agreement that, in the words of Myrdal, “Rent control has in certain Western countries constituted, maybe, the worst example of poor planning by government lacking courage and vision.”7

    Assar Linbeck, a Swedish economist from the “left,” asserted that, “In many cases rent control appears to be the most efficient technique presently known to destroy a city—except for bombing.”8 Clearly, the best way to ensure maximum housing availability at the lowest prices is for the government to allow the free market to function with minimal government intrusion.

    Jackson, Greg (2011-07-13). Conservative Comebacks to Liberal Lies (Kindle Locations 1785-1820). JAJ Publishing. Kindle Edition.

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  18. Camryn (543 comments) says:

    San Francisco does this. Such a horrible policy. It infringes on the rights of the landlords and places the full cost of a social policy on this group instead of on the society that wants the policy. The perverse incentives become huge… buildings are deliberately run down for a start. And rents for properties that do become available are higher than they should be as landlords try to protect themselves against not being able to raise them later. And people don’t move when they should to keep their low rent = overcrowding and longer commutes to work and worse traffic. And old people stay in the city instead of retiring to the fringes and making space for workers. Cluster!

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  19. mandk (993 comments) says:

    This is just another example of pitifully poor journalism.

    The Stuff report actually contradicts itself. It starts by saying that rent controls are recommended by HRC, but it says later that HRC suggests that the Govt should consider rent controls.

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  20. iMP (2,385 comments) says:

    WE NEED this in Chch.

    The rights of Landlords to crank up their rents 500% in the wake of a disaster to exploit local people who have no option, has to be balanced against renters rights to have reasonable rents. Many people are paying OVER 60% of their income on rent. Others choose to live on the beach, in cars, garages and tents because they simply cannot afford the rents.

    Nothing has changed for mamy of these absent landlords, just the opportunity to charge double AND get it due to desperation. EVIL.

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  21. Kimble (4,440 comments) says:

    I agree with iMP, Christchurch should institute rent controls.

    We have seen that living in Christchurch can be very dangerous. It is just too risky a place to have people building a settlement. Best to institute policies that will slowly destroy the city and have those people move somewhere more sensible.

    And the best way to get that done is by appealing to and exploiting the ignorance of the Idiot Vote.

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  22. MT_Tinman (3,187 comments) says:

    iMP ……renters rights to have reasonable rents.

    There is no such right, you simply made it up.

    Bullshit, like the rest of your rant.

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  23. burt (8,271 comments) says:

    I never knew that people effected by the quakes were required to stay in Chch. Here was me thinking that they could move to other places if rent was an issue. Silly me…. This is NZ and people have an entitlement to other peoples money when things don’t work out for them like they had hoped.

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  24. wreck1080 (3,917 comments) says:

    @imp — if rent controls were introduced, rent would be cheap but there would be 0 supply so you are in a worse position than before.

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  25. burt (8,271 comments) says:

    wreck1080

    No wrong. Dear Leader said a free house for all… Look at other communist countries – how awesome is/was the standard of housing that all enjoyed ….

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  26. Albert_Ross (293 comments) says:

    iMP, I know you’d like it if everybody always behaved generously and selflessly towards their fellow human beings, seeking only to provide what other people wanted with no thought for themselves. We all would.

    But simply passing a law requiring people to behave as if they were generous, selfless and wanted only to provide for other people with no thought for themselves will not have that effect. In fact it usually simply makes things worse. That’s been demonstrated in practice time and time again, as some of the examples mentioned here show.

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  27. backster (2,172 comments) says:

    THE Human Rights Commission should get the Commerce Commission to destroy the property market for them just like they have done the sharemarket.

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  28. OneTrack (3,107 comments) says:

    Cunliffe will be soon announcing KiwiRent. All rental properties will be nationalised and offered at “low rentals” to approved candidates. Actually paying rent will be optional as any shortfalls will be made up by more taxing of “rich pricks”(tm), or running Russel’s printers for an extra day per week.

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  29. nickb (3,687 comments) says:

    I am glad to see the Human Rights Commission is focusing on human rights instead of side issues that would waste the HRC’s resources like, you know, National’s erosion of the right to a fair trial, or government collection of information on its citizens, or private property rights.

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