Weeks before the St. Paul rent “stabilization” plan takes effect, the St. Paul Pioneer Press reports that “Apartment Construction Slows by More than 80 Percent in St. Paul.” But wait, there’s much more to this story.
While city officials try to explain away why developers might be scaling back plans to build much needed housing in St. Paul, a much more damning report was released about the longer-term effects of this hastily-conceived ordinance.
Specifically, “researchers with the University of Southern California’s Marshall School of Business published a 58-page study of St. Paul’s housing market that claims that rent control caused property values to fall by 6 or 7 percent, for an aggregate loss of $1.6 billion.”
The study’s authors note that St. Paul’s rent control ordinance is especially “stringent” and does not adjust rents for inflation or exempt smaller rental units or even new construction. The report goes on to say that this utopian dream of income redistribution is doing little or nothing to help the poorest city residents. Huh. Didn’t see that coming did we?
You can read the full report HERE and you can bet that we’ll be watching and reporting on the full effects of this hastily written and potentially devastating progressive policy as it rolls out in St. Paul.