Why Rent Control Might Be Hurting the People It’s Meant to Help

Freezing rent might sound great if you’re already in an affordable unit — but don’t even think about moving, because then it’ll cost you big time.

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Nov 12, 2025

Host Cara Stern is back from parental leave, and she and Mike are jumping right into one of the most debated topics in housing policy — rent control. Inspired by Zohran Mamdani’s campaign rent freeze proposal, they dig into how these rules shape the housing market, not just for landlords and tenants, but for entire cities. While rent control offers stability and predictability for those lucky enough to have it, it can also quietly freeze people in place — making it harder to move for a new job, grow a family, or even downsize later in life.

In this episode, they explore how rent control affects mobility, opportunity, and fairness between long-term renters and newcomers. From young families trying to upsize to seniors staying put in oversized apartments, Cara and Mike unpack the tradeoffs behind this well-intentioned policy. Is rent control helping affordability, or holding cities back from building the housing we actually need?

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Below is an AI-generated transcript of the Missing Middle podcast, which has been lightly edited.

Mike Moffatt: Before we dive into it, I just wanted to start by stating the obvious, which is that Cara is back from parental leave. For those of you who don’t know Cara, she’s a fantastic journalist who is one of the founding members of the Missing Middle team. So welcome back, Cara!

Cara Stern: Thanks so much. I’m excited to be back, and let’s get into it!

So, New York City recently elected Zohran Mamdani, who promised to freeze rents on stabilized apartments. It got us at The Missing Middle thinking about rent control and its effects.

There are the normal discussions you hear about rent control, like whether it hurts housing supply and whether it leads to landlords ignoring repairs that need to be done. But there’s also an aspect that I feel like gets overlooked sometimes, and I wanted to address it here.

And that’s the way that rent control locks people into place. Most provinces that have rent control have a system where some apartments are included and others, usually newer ones, aren’t. That’s also the case in New York City.

Under a rent-controlled market, the longer you rent a home, the cheaper it becomes relative to the market rent. This has been especially true in markets like Toronto, where rents shot up over a short period of time. When you’re thinking about that, what are some of the situations that come to mind for you where this is a problem for mobility, Mike?

Mike Moffatt: Yeah, so I’ll give an example. I live very close to a low-rise apartment building, and I had a neighbour who would often walk her dog past our house a couple of times a day. (The problem with being someone who’s known as a housing guy is that everybody talks to you about housing.) She was particularly concerned because she had a job that was close to where she lives, but she had been looking for something else, and quickly we came to realize that if she was going to take a job that was far away from this neighbourhood, her transit times would go up. It’d be hard to get to work, particularly if she had to switch cities.

She was in a unit that she’d been in for a very long time, so the rent she was paying was much lower than what rents are on the market. She was really conflicted by this because on the one hand, she was very grateful for those lower prices. She said, “That’s the only thing that’s allowing me to live here.” But she would also say, “Hey, I feel really trapped that I can’t change employers. I can’t move to a different city because I can’t afford to live there unless I get a massive raise or something like that.” And this is very common.

It doesn’t just affect people at the individual level, but it affects the productivity of the economy as a whole, because people can’t go where jobs are the best. They’re locked in place. They continue having to work somewhere that might not be the best fit for them for one reason or another.

Cara Stern: I wonder how much people think about that when they’re getting their apartment. I can imagine someone looking to rent an apartment and wanting to be close to their work. They’re probably not thinking ahead of time, like “My work might change and I might have to move. And this could be a problem in the long run.”

I can understand why someone might want to settle somewhere downtown, if you’re in Toronto, or somewhere close, centrally located near a subway or something like that, so that you can open your options of where you can live without having to move. But I wonder how much people think about that. Any idea?

Mike Moffatt: Yeah, I think that is a big concern for people. So somebody else I know lives in a two-bedroom apartment, and at the time, she was wavering between, “OK, do I go for the one bedroom or the two bedroom?” And it’s now greatly relieved, all of these years later, that she went for the two-bedroom apartment.

So I imagine people don’t think about that as much as they probably should. Because at some level, you probably are just thinking about today. You really don’t know what you’ll be doing five, 10, 15 years from now. So I think it is probably the case that people are making the decision that meets their current needs and not necessarily thinking through how this might lock them in the future.

Cara Stern: I’m thinking a lot about people who are deciding whether to have kids because I’m at that age where a lot of my friends are having kids or they’re deciding whether to have a second kid.

A lot of them start in a situation where they’re in a one-bedroom apartment. That was exactly what I was living in when I was thinking about having a kid, and when I looked at the rental market, I had been in that one-bedroom apartment for several years. I think it was something like five years, six years ago. At that point, that was right when the market started going up.

So my rent was quite a bit below what the market rent was, and I sat there for a lot of late nights trying to figure out how do I make it work in this one-bedroom apartment? Do I get a temporary wall? Can you buy soundproofing? Do you just put up a little curtain and lots of sound machines and hope that your kid doesn’t mind you guys talking or walking around when they’re trying to nap? There are a lot of different options that I came up with. I’ve seen people come up with creative solutions like turning the living room into a bedroom, and you just don’t have a living room anymore, and that’s not great, but people think about those kinds of things.

For me, I got lucky in that when I decided to have a kid, the pandemic had happened, and the prices of rentals did go down briefly. So I was like, “I’m jumping on that. I’m going to get that two-bedroom.” By the time I moved out, less than two years later, the next person moving in was paying 50 percent more.

I often think about people who are in that situation who maybe weren’t as lucky as I was in the timing. They might be delaying having a kid because they don’t have a suitable space for them to be living in. I wonder how many kids, like honestly, how many kids are not being born right now because of housing sizes.

We’re hitting very low rates of fertility. We’re breaking records all the time in Canada right now. So I think that’s something we should be thinking about.

Mike Moffatt: Yeah, absolutely. I think one of the lessons here, one of the things we see, is that it can cause people to be underhoused. They get locked into a unit, and either their family grows or they would like their family to grow, and they can’t necessarily upsize.

But we also see it on the other end. We also see it in the downsizing. New York City is a classic example of this, where you’ve got an 80-year-old living in an apartment that they moved into in 1968 and paying pocket change as rent. They’ve got this three-bedroom apartment, and even if they thought to themselves, “Hey, this is too much space. I should probably downsize.” Going to something much, much smaller would have a much higher rent.

So it kind of locks seniors into place as well. If they were able to downsize, that might not just help seniors, but also help the next generation of families who could really use a three-bedroom apartment.

Cara Stern: I can’t imagine being a senior and making that decision to downsize and knowing that you’re going to pay more to downsize. That makes no sense.

So we’ve just highlighted three reasons why rent control is bad for mobility. It prevents people from taking a good job outside their area. It might be a disincentive for people to have children. And it might keep seniors locked into homes that are too large for their needs.

I’ve spent a good amount of time online talking about rent control. What I’ve noticed is that the dominant thought, especially among young people, seems to be that rent control is a huge benefit to tenants and that we should be expanding it as much as possible. Rent is too expensive? Make it less expensive. Cap how much people can raise it, and it absolutely is a benefit. No question, once you’re in, you’ve got that stability.

But I keep thinking people need to zoom in closer and see what’s actually happening here, which is, as we talked about, the longer you’ve been there, the less you pay compared to the new tenants. So there’s almost like this generational divide in terms of who is benefiting from rent control.

People who have been there much longer might be paying half of what a new tenant might be paying. If I were moving into a building and I knew that, I think I’d be kind of annoyed about it.

Mike Moffatt: Yeah, absolutely. There are all kinds of distributional consequences. So if you are the type of person who doesn’t need to leave anytime soon, who can stay there 10, 15, 20 years, and is not planning to increase or decrease the size of your family, then over time, you’re going to benefit significantly.

Who can get hurt by this? People who need to move frequently, younger people who are moving into their first place. Because they’re competing for a limited pool of units. Oftentimes, rents are set so that the new tenants are subsidizing the existing tenants. A building owner is going to try to make sure that they make enough profit to make this viable. So it does have these distributional consequences.

We see that long-term tenants in all types of units on average pay almost 20% less than new renters in the same types of neighbourhoods and cities in places with rent control.

That gap grows the longer somebody has been in one of those units. So, like a lot of things in housing policy, the system really does work better for incumbents than it does for newcomers.

Cara Stern: Can you explain a bit more about that subsidization? Because one thing I’ve noticed, talking to people who have been in units for a long time and are paying below market rent, they sometimes get their backs up at the idea that they’re being subsidized by other people. How does that actually work in practice?

Mike Moffatt: In most versions of rent control, rents can only go up at about the rate of inflation. That’s the standard rule. But oftentimes, the cost for landlords will be going up more than that because property tax rates are climbing faster than inflation. Deferred maintenance costs, you need to repair these units and so on. That money has to come from somewhere.

Different landlords deal with this in different ways. Some just skimp on maintenance. They’re like, “Well, I can’t make the math work, so I’m not going to repair things.” We see that in a lot of older buildings.

Sometimes you get a lot of smaller landlords who just realize, “OK, the math can’t work.” And they end up selling the building to a REIT, a real estate trust. And there’s a lot of media around that. Or a real estate trust - buying up buildings from older landlords. The real estate trust believes that it can, through whatever means, make that math work.

Then oftentimes when you’re renting out a new unit, kind of recognizing, “Hey, I’ve got to recoup these costs somewhere.” So you jack up the rent on the other units high, and you’re willing to allow those units to be vacant a little bit until you find the right tenant. Because you also know that the amount you set the rent at creates the floor for what rents are going to be on that unit in the future.

So it absolutely affects the pricing strategies and the other strategies that landlords use to make sure that they can turn a profit on these buildings.

Cara Stern: There’s a bit of an aspect of NIMBYism here, and it’s not so straightforward, so let’s take a minute.

But we normally talk about NIMBYism where someone wants to block a building. They’re like, “I don’t want this big tower going up in my neighbourhood. It’s going to ruin my neighbourhood. I don’t want that.” We hear it in lots of different ways. In this sense, it’s not that people are blocking a specific building, but when people are defending a system that we have right now, which does protect those who have at the expense of those who don’t, it does kind of feel like a little bit of nimbyism.

There’s like a huge privilege associated with getting in early that I just don’t think is recognized enough. Do you see it that way?

Mike Moffatt: Yeah. Now, I think it’s a little bit different because I do think there is a difference in intentionality here that I do think on rent control, that people aren’t trying to screw over the new people, is just kind of a side effect of how the system works. I feel that with NIMBYism, they are trying to block out the new people.

Certainly, there are policies to deal with that. I think that’s best covered in another episode, but some places have vacancy control, which is a policy where the price can’t change when the tenant changes over. Now that also creates other challenges.

That’s a big story in public policy. Oftentimes, when you’re trying to correct one thing that’s going wrong, you create unintended consequences, and that causes other issues. Policymakers have to weigh it off. It’s like, “Okay, what’s worse, the issue I’m trying to fix or the issues I’ll create from trying to fix this issue?”

A lot of times, it is still worth doing the policy. You would rather have the second set of problems than the first set of problems. But that’s always an issue in public policy.

I do think it is worth talking about the fact that there are these distributional consequences here to existing rent control systems. That newcomers to the country or people who have to move quite frequently don’t really benefit as much as the people who can stay in place for 10, 15, or 20 years.

Cara Stern: I think we’ve talked about so many times on this podcast about different situations, people in relationships that can’t leave their relationships because they can’t afford to live on their own. There are just so many reasons why someone would want to move and can’t do it. I wonder if rent control were abolished tomorrow, would that improve mobility?

Mike Moffatt: Yeah, almost certainly, and there’s a real-world example of this. So from about 1970 to the mid-1990s, Cambridge, Massachusetts, which is part of the Boston metro area, it’s the home of Harvard University. They had pretty strict rent control for apartments and other rentals built before 1970.

So after 1970, those buildings were subject to the market pricing, but the pre-1970 buildings were rent-controlled. Now, on those rent control buildings, the renters tended to pay 20 to 40 percent less than comparable units that were built in 1970 or after that weren’t subject to rent control. This shows that rent control was keeping prices down.

But not surprisingly, this tended to cause people to stay in place if they had one of those rent control units, because if you had one of those units, you really couldn’t afford to give it up. Or why would you? Because it was saving you hundreds of dollars a month.

In 1994, rent control was eliminated, and not surprisingly, mobility went way up in these formerly rent-controlled units, as there was no longer a particular premium to stay in one. Now, that increase in mobility wasn’t always positive because evictions also went up for these units as rents rose quickly. So it wasn’t necessarily always people leaving on their own accord. Sometimes it was people getting pushed out. So there was an ugly side to it.

There were all kinds of other effects, such as increased maintenance and repair that because you could charge more for these units, landlords wanted to make them really nice, to spiff them up. Yeah, it did make them more expensive, but they were nicer places to live.

So we could do a whole episode alone about all the sort of drawbacks and costs to this Massachusetts experiment. In the meantime, we’ll put a link to the original study in the show notes, but the sort of tldr version answer to your question is “yes, if you got rid of rent control, mobility would improve.”

But I gotta ask you a question, when you asked me if rent control should be abolished tomorrow, were you just playing devil’s advocate there, or do you really believe that Ontario should end rent control?

Cara Stern: It’s tough. I don’t know how you remove it when it’s already in place for so many people who are counting on their rent not changing that much in order to make ends meet.

There’s no easy way to end it, even though you can look at all the studies and see that it does impact rental supply, and in the long run, it might not be the best idea. I just don’t know how you can actually remove it once it’s already in place without hurting so many people.

I also don’t like that the rental crisis is felt by such a small number of people. We can look at the number of people who are renting, and most of them aren’t directly affected by the increases in the cost of renting, especially in the GTA, because they have rent control.

So the number of people it’s affecting is small. Politicians can easily just kind of wave it away and say like, “Oh, this is not a huge issue. We’re not going to get massive amounts of protesters coming out. Saying, ‘we’re upset. We need this to be fixed.’” It’s such a small number of people. I think a lot of politicians might look at it and go, “Well, those people are just temporarily renting while they figure it out until they buy a home. That’s how we used to do it. It’s fine. Who cares?”

So I feel like we should be tackling all the other aspects of rental supply before we tackle the one that actually has a day-to-day effect on the pocketbooks of extremely vulnerable people in our society.

It’ll be super interesting to see what happens in New York City. I would love to see what the real-world impact is of a rent freeze on the market prices, especially the ones that don’t have any rent control.

I’m curious what it’ll do to that. In my mind, the best form of rent control would be an ample housing supply. That way, landlords would have to compete for tenants, and tenants would have the flexibility to move.

Mike Moffatt: Absolutely. I think the best form of rent control we can have is a 7% vacancy rate. The only way we’re going to get to where we need to be - to get to a point where market rents are around the same level as rent control rents and allow people to move- is through that increased supply.

Cara Stern: Thanks so much for watching and listening. And thanks as always to our producer, Meredith Martin.

Mike Moffatt: And if you have any thoughts or questions about where to get a good cup of coffee near Harvard and Cambridge University, please send us an email to [email protected].

Cara Stern: And we’ll see you next time!