San Francisco and New York City have recently sought to impose tighter regulatory controls on multi-family landlords. These controls will likely cause landlords to incur unforeseen additional costs that will impact the economic value of their investment. The question is whether courts will allow constitutionally protected property rights and investment-backed expectations to be eroded by such regulation.
Today, many landlords will not remember when Philadelphia had its own form of rent control, principally because it was struck down by the Pennsylvania Supreme Court in 1955. In the last 65 years, there has been no meaningful desire to see its return. However, in New York and San Francisco, rent control is the law. Oregon recently passed its own rent control law, and Massachusetts may not be far behind. Experts disagree on the effectiveness of rent control. Some believe it tends to accelerate gentrification by incentivizing landlords to convert rental housing into higher-end condominiums. Others believe it may reduce the displacement of lower-income tenants and the elderly.