The Effects of Rent Stabilization on Individuals, Buildings and Neighborhoods
*Names in bold indicate Presenter
We assemble a novel panel of the universe of buildings in New York City linked to administrative data on rents, rent regulation status, housing quality, and rates of exit to homeless shelters and rates of eviction in NYC from 2005-2014. We supplement this original data set with tenant and neighborhood characteristics from the Census HVS and ACS, respectively.
We use three quasi-experimental research designs to examine the causal effects of rent stabilization on a range of outcomes: rents, building quality, homelessness, evictions and tenant composition. The different models yield causal effects under different assumptions and thereby allow for robust inference of the causal effects of rent stabilization on these outcomes. Our three approaches are:
1) Building fixed effects model
2) Difference in differences model using exogenous timing of “decontrols” from the expiration of stabilization requirements stemming from city financing programs.
3) Fuzzy regression discontinuity design using a legislated threshold in rent stabilization requirements based on year built.
We examine how these effects interact with neighborhood rent price trends to shed light on whether rent stabilization helps maintain neighborhood economic diversity and integration in gentrifying neighborhoods.
Our results on the costs and benefits of rent stabilization will help inform present and future debates on the role of rent stabilization and other housing policies as many cities contemplate policies to combat rising rents.