Column: The Hidden History Of Rent Control

Rent control has a long institutional history in this country. State and federal governments throughout the 1920s and 1940s viewed it as a legitimate policy tool and a way to place tenants' needs above property owners' profits.

In 1918, thousands of tenants in New York City participated in rent strikes as members of local neighborhood tenant leagues. The Greater New York Tenant League and local Socialist Party called upon the state legislature to enact a law to limit rent increases. By 1920, the New York state legislature passed laws that allowed tenants to contest excessive rent increases in court. The controls remained in effect in New York City throughout the "Roaring Twenties."

World War II prompted a mass migration of the U.S. population to cities in search of war-economy jobs in defense plants, shipyards and offices. Because residential construction had come to a standstill during the Great Depression, a housing shortage quickly developed in the "war boom" cities. Apartment rents increased rapidly between 1939 and late 1941. Congress responded by enacting rent regulation nationwide.

The Emergency Price Control Act of 1942 aimed to stabilize prices and "prevent speculative, unwarranted, and abnormal increases in prices and rents." Other purposes of the Act included the elimination and prevention of "profiteering, hoarding," and "manipulation" and the protection of "persons with relatively fixed and limited incomes, consumers, wage earners, investors, and persons dependent on life insurance, annuities, and pensions" from excessive rents.

By November 1942, the government's Office of Price Administration [OPA] was regulating rents in every large city in the United States except New York (where landlords argued high vacancy rates made rent control unnecessary). A coalition of tenant, consumer, and civil rights groups, labor unions and left-wing political groups then mobilized to demand that the OPA also freeze rents in the "Big Apple."

Among the groups involved in this coalition were the United Tenants League, the Citizens Housing Council, the People's Committee in Harlem, the Consolidated Tenants League, the National Negro Congress, American Labor Party clubs, Communist Party clubs, the Transport Workers Union and the National Maritime Union. After a ghetto rebellion in Harlem on August 1, 1943 (triggered in part by the wartime increase in rents), the OPA began regulating rents in New York City.

After the war, Congress extended federal rent regulation until March 1948, but allowed landlords to increase rents by 10% upon tenant turnover. In addition, the Housing and Rent Act of 1947 removed rent ceilings on new apartment buildings and created new local advisory boards empowered to deregulate rents in cities around the country.

By 1952, Congress had ended all remaining federal control of rents in privately owned residential buildings. In New York City, however, state and local regulation of rents continued and by the late 1970s at least 169 other localities had joined New York City in reintroducing rent regulation to protect local tenants from excessive rent increases. And in the early 21st-century--unlike the so-called "People's Republic of Cambridge," Boston and Brookline--166 communities in the United States still had rent regulation of some form.

One hundred years ago in the United States, tenants generally only paid their landlords between 15% and 25% of the wages they earned each month. But in the 21st-century, most tenants in the United States pay their landlords over 30% of the wages they earn each month, and in many cities, like Cambridge, Boston and Brookline, far more than 30% of their wages.

Yet even in those communities that have some form of rent regulation, the local real estate industry landlords, and other special real estate interests are working to limit and weaken tenant protections.

Local real estate boards in coordination with national professional and lobbying associations, including the National Association of Realtors, the National Council of the Multi-Housing Industry, and the National Apartment Association, lobby politicians--whose campaigns they bankroll--to bore loopholes into existing regulations. For example, many New York landlords obtained permanent "major capital improvement" rent increases in rent-stabilized apartments in buildings they owned in the 1980s and 1990s just for replacing old windows, thanks to a legal loophole that resulted from lobbyist pressure on the state legislature.

According to a 1997 report, "Rent Deregulation in California and Massachusetts," by political scientist and urban policy scholar Peter Dreier, California apartment owners and other real estate interests "invested millions in campaign contributions to support anti-rent control legislation," spending "an estimated $50 million to fight rent control" between 1985 and 1997.

On the national level, the National Association of Realtors also contributed over $4 million to fund the electoral campaigns of Democratic and Republican Party candidates for federal office in 2002. And during the 2018 election year cycle, the National Association of Realtors's Political Action Committee [PAC] contributed over $3.4 million to fund the electoral campaigns of Democratic and GOP federal candidates, including $10,500 to Massachusetts Rep. Stephen Lynch's campaign committee, $10,000 to Massachusetts Rep. Jim McGovern's campaign committee, $10,000 to Massachusetts Rep. Richard Neal's campaign committee, $8,000 to Massachusetts Rep. Seth Moulton's campaign committee and $6,000 to Massachusetts Rep. Joe Kennedy III's campaign committee.

As Dreier puts it:

"It is difficult to exaggerate the political influence of the real estate industry. For years, the various components of the industry--apartment owners, developers, realtors, managers and lenders--worked together to oppose rent control and other tenant protections. This persistence and unity eventually paid off...Industry organizations and their staffs developed close ties to legislators at the state and local levels over the course of several decades."