Rents on Oregon homes built 15 years ago or more will be allowed to rise by a maximum of 9.9 percent in 2022. Newer homes are exempt, a carve-out intended to keep the rule from discouraging the construction of new rentals.—The Oregonian
Is a rent ceiling always effective in holding down rent?
A rent ceiling is not always effective in holding down rent. If a rent ceiling is set at or above the equilibrium rent, it is ineffective.
If Oregon’s rent ceiling is effective, does it create a housing shortage?
An effective rent ceiling creates a housing shortage. Because an effective rent ceiling is set below the equilibrium rent, the quantity demanded exceeds the quantity supplied.
Can Oregon have a housing shortage if its rent ceiling is not effective?
Oregon will not have a housing shortage if its rent ceiling is set above the equilibrium rent, but low-income families might be unable to afford a reasonable home, so the supply of housing might be lower than is in the social interest.
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