Effects of rent control Rent controls require that landlords set apartment prices below the equilibrium price level.
An immediate effect is an apartment rental shortage (excess demand for apartments), because at the regulated price the quantity of apartments demanded is greater than the quantity supplied.
When landlords are prevented by cities from charging market rents, which of the following listed outcomes are common in the long run?
a. Landlords earn lower profits from renting housing units, but the rent charged has no effect on either the quantity or quality of rental units.
b. Nonprice methods of rationing emerge.
c. The quantity of available rental housing units falls.
d. Black markets develop.
