Saturday, February 1, 2020

Seattle commits the hidden cost fallacy

In Seattle, if you have a spare room to rent, you cannot conduct a criminal background check and you have to rent to the first person who shows up.  The new laws will reduce supply, or encourage black-market rentals, as they make renting to strangers more costly:

Landlords aren’t the only victims. Renters will suffer too. As owners like Ms. Yim and Ms. Lyles flee the housing market because they can’t bear the regulatory burden, the contraction in supply will further inflate rents. Remaining landlords will raise prices even more to underwrite the risks they face because they can’t adequately vet rental applicants.
HT:  Cramer

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