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Rent control ‘can destroy a city’

Monday, December 4, 2017

The report in the T&T Guardian of November 29, headlined Rent restriction under review, reminds me of the old adage: there are three ways by which a city can be destroyed, earthquake, hurricane and rent control.

According to the article, the Government is once again looking at the third way. The report indicated that the Attorney General said while there was no intention “at this point” of reintroducing rent restriction in general, the situation is currently under review.

I have lived through the years when rent restriction was introduced for properties then renting for less than $1,600 monthly. The first effect was the financial ruin of landlords who had invested in those properties for rental income at a time when other investments were hard to find. The second was the end of private investment in the construction of properties, which would fall under that rental, and little investment in high-end building because of the fear that the dead hand of Government would seek also to “control.”

The outcome was inevitable. Those properties in the rent control bracket were eventually allowed to deteriorate by rational landlords who refused to maintain those for which they were receiving little return.

The housing stock in the country slowly deteriorated until the Government of the time stopped renewing the Rent Restriction Act, making it ineffective and offered incentives for housing constructing. The market was allowed to prevail and modern Trinidad and Tobago began to emerge with the first condominiums being built together with large housing developments.

The Government is cautioned that those who forget the past are doomed to repeat it. There is no lack of housing in the country at the upper end. Government has been building at the lower end over the years.

They should continue to do so.

Hopefully, there is now a large enough property-owning constituency in the country to exact an electoral toll on any Government with the temerity to once again confiscate their properties in the cause of providing cheap housing for others. That is the job of Government, not private citizens of the country.