Incidence, Allocation, and Efficiency Costs of Tenancy Rent Control

Lukas Hauck, Nicola Stalder, Simon Büchler, Maximilian von Ehrlich

Diskussionsschriften from Universitaet Bern, Departement Volkswirtschaft

Abstract: Tenancy rent control limits rent increases for sitting tenants while allowing market resets at vacancy. When demand grows or household composition differs across segments, spillovers raise rents in the unregulated market. We study its general equilibrium effects in Switzerland, where a nationwide regime meets large spatial variation. Linking administrative records on all households from 2010–2022 to detailed unit data and market rents, we estimate a structural sorting model with heterogeneous preferences, correcting for selection and price endogeneity. Counterfactual simulations show unregulated rents would be 8–21 percent lower, with the largest drops in supply-inelastic cities. Older, lower-income, and less educated households gain most, while newcomers face higher entry rents. The policy reduces mobility and induces space overconsumption, generating efficiency losses.

Keywords: Rent Control; Residential Mobility; Inequality (search for similar items in EconPapers)
JEL-codes: H7 H72 R23 R31 R38 (search for similar items in EconPapers)
Date: 2025-07
New Economics Papers: this item is included in nep-lab
References: Add references at CitEc
Citations:

Downloads: (external link)
https://repec.vwiit.ch/dp/dp2507.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ube:dpvwib:dp2507

Access Statistics for this paper

More papers in Diskussionsschriften from Universitaet Bern, Departement Volkswirtschaft Contact information at EDIRC.
Bibliographic data for series maintained by Franz Koelliker ().