Hans Lind: Department of Real Estate and Construction Management, Royal Institute of Technology, Postal: Department of Real Estate and Construction Management , Royal Institute of Technology, Brinellvägen 1, 100 44 Stockholm, Sweden
Abstract: The standard view is that rent regulation leads to reduced maintenance as the landlord will be able to find tenants at the regulated rent even if the level of maintenance is low. In this article it is shown that the rent regulation system in Sweden interacts with a contract structure where the rent is allowed to increase only if the standard of the apartment is raised compared to when the apartment was new. Ordinary maintenance is included in the rent, and the rent is therefore not allowed to increase when such maintenance is carried out. It is shown that when there is a housing shortage this system creates economic incentives for increasing the standard of the apartment even if this reduces total welfare. The result can be that quality is increased more than in a market system, and that it can increase gentrification compared to such a system. Policy proposals are also presented.
18 pages, October 27, 2014
Full text files
Questions (including download problems) about the papers in this series should be directed to Herman Donner ()
Report other problems with accessing this service to Sune Karlsson ().
This page generated on 2018-01-23 23:34:59.