Opinion: St. Paul's Proposed Rent Control Law Would Halt New Development

Rent control is a popular response to the ongoing housing affordability crisis in many parts of the United States, but there is still a chorus of economists and planners who argue that rent control can do more harm than good to housing affordability.

September 24, 2021, 5:00 AM PDT

By James Brasuell @CasualBrasuell


An image of St. Paul, Minnesota and the Mississippi River at nightfall.

Paul Brady Photography / Shutterstock

Bill Lindeke writes for the twin cities sidewalks blog to make the case that the Housing Equity Now Saint Paul (HENS) rent control proposal, which would cap rent increases at 3 percent annually, would stop new housing from being built—a "de facto ban on housing," as it's described here.

Earlier this month, Lindeke reported for the MinnPost that St. Paul voters are faced with the prospect of approving the country's most aggressive rent control policy in the November election. To recap the summary of the HENS proposal provided in that article:

The law would cap rent increases for all of the city’s 65,000 rented homes at 3% per year, but includes a complicated list of factors that allow landlords to apply for a variances — things like property taxes, maintenance issues, capital improvements (only if needed to bring a building to code), and a few others. The process for applying for the variances is yet to be determined. The ordinance exempts only subsidized housing from the caps.

In the blog post for twin cities sidewalks, Lindeke explains that the question that keeps coming up since the MinnPost article is as follows: "Why does a 3% rent cap stop new housing from being built?"

Lindeke's answer, which you should click through below to read in full, hinges on

  1. The difference between landlords and developers: "3% is usually fine for a landlord but a huge limit for someone leasing out a new building."
  2. Inflation: "If inflation is close to or higher than 3%, you're just plain screwed. Not only can’t you move rents around to fill a building, you're actually forced to lower rents in real dollars." 

The 3 percent cap on rent therefore, according to Lindeke, "greatly increases the risk of loans for new housing construction."  

Monday, September 20, 2021 in twin cities sidewalks

Soldier Field

Phase 1 Revealed for $20 Billion Chicago Megaproject

Plans for One Central, a proposed megadevelopment that would add 22.3 million square feet of buildings to the city of Chicago, are taking shape.

October 19, 2021 - Chicago Tribune

A screengrab of the Caharlotte Future virtual open house.

Top Websites for Urban Planning – 2021

Planetizen's annual list of the best of the urban planning Internet.

October 25, 2021 - James Brasuell

An aerial image of the neighborhood of Buckman in Portland, Oregon.

Homeowner Groups Find an Antidote to Zoning Reforms: National Register Historic Districts

Many neighborhoods are moving to create historic districts on the National Register of Historic Places in response to the growing number of states, cities, and neighborhoods loosening single-family residential zones.

October 22, 2021 - Sightline Institute

Urban Design for Planners 1: Software Tools

This six-course series explores essential urban design concepts using open source software and equips planners with the tools they need to participate fully in the urban design process.

Hand Drawing Master Plans

This course aims to provide an introduction into Urban Design Sketching focused on how to hand draw master plans using a mix of colored markers.