Newsgroups: can.politics
Path: utzoo!utgpu!jarvis.csri.toronto.edu!csri.toronto.edu!eem
From: eem@csri.toronto.edu (Evangelos Milios)
Subject: Re: rent review
Message-ID: <1988Feb28.002014.29461@jarvis.csri.toronto.edu>
Organization: University of Toronto, CSRI
References: <1988Feb24.140628.28040@jarvis.csri.toronto.edu> <1433@looking.UUCP> <1988Feb26.225840.21116@jarvis.csri.toronto.edu> <1437@looking.UUCP>
Distribution: ont
Date: Sun, 28-Feb-88 00:20:10 EST

In article <1437@looking.UUCP> brad@looking.UUCP (Brad Templeton) writes:
>I'm not sure what's to blame for the situation in Toronto, but the statement
>that "without rent control, and .1% vacancy rate, the sky's the limit on rents"
>is actually the reverse of the truth.
>
>The .1% vacancy rate is *caused* by the rent control.  
>A free market would not have two distinct classes of appartments 
>for places that are otherwise the same in quality.
>Instead prices would move together.  The rent controlled places,
>which are artificially low for the few who can get them, would go up.  The
>currently non-controlled places would go down.

This is a good point, but I still insist that $1000/mo+utils for a
2bdrm apt on a family income of 32K/yr, corresponding to a family
where only one spouse works, is plain too high. So the rent dictated
by the free market is too high for the average person. We are talking
about a market dominated by speculative fever (real estate investors)
and panic (renters who can barely afford a house go out and buy one,
because they may not be able to afford it next year, if the market
goes up by 20% whereas their income goes up only 8% -- to buy the
average house in Toronto these days you need a family income of at least
$50K/yr, which is quite high).  Stock markets like that are very
unstable and regulatory agencies limit free market action by
restricting trading.

I am not sure if rent control is the right kind of restriction on free
market action, but some kind of restriction is necessary, as long as
demand drives rents to levels beyond the reach of the average person.
Broadening the co-op housing base (which I doubt is on the average worse
than my $1000/mo rent-controlled 2bdr delapidated apt) could be
another possible regulatory action. Interpreting my statements as
implying that everything should be state-owned is probably an
overgeneralization.

In the case of housing in Toronto, the demand is such that the free
market, with or without rent control, fails to fulfill the basic right
of the average hardworking person to decent, affordable housing. 
Do you disagree with this statement? If yes, why? If not, what should be
done about it?

...eem




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Evangelos E. Milios	        Internet(UUCP,ARPANET,BITNET,CSNET):          
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