Price ceiling are imposed on rent prices by the government to ensure that rent charges are below the market prices hence affordable to both the high and low income earners. Price ceiling creates a high demand for house that exceeds supply hence making the market not to reach equilibrium. In a city where price ceiling are used to determine the rent charges then there will be shortage of houses as a result of high demand and low supply. The shortage of housing facilities may lead landlords to adopting other forms of allocating houses that may be unethical or corrupt. The unethical and corrupt behaviors can be segregation, bribery or allocation of houses on the first come first served basis. The low rent income to the landlords discourages investment in the housing sector because every investor would want to make profit from the investment made. The housing condition also deteriorates due to lack of maintenance from the landlords who find it difficult because of the low revenues generated by the apartments.
Rent controls can be related to the six core values of Saint Leo University which include respect, excellence, personal development, community, integrity and responsible stewardship. Rent controls affect these values in the following ways:
Rent controls affect the respect that subsists between the landlord and the tenant and that between the tenant and the neighboring tenant. The landlord will not respect the tenant even when requested to uphold good housing standards. This is because the landlord is confident that there is a high demand for houses and if the tenants are not comfortable then its better if they leave room for those who are interested. Tenants on the other hand will also not respect the landlords and will try to find ways to maximally utilize the space they are allocated. Tenants will respect each for fear of being evicted.
Excellency can not be achieved using the rent controls. Landlords will not be willing to maintain good standards of their houses because of the high demand and low competition. Tenants will only be able to get what they want through bribery or opt to lower their expectation.
Personal development is the key thing that helps us improve our lives. Rent controls may force people to do what they may not have wanted to do but because of the situation they just have to. Working in a city where there are rent controls will force an individual to lower the housing standard desired because one has to work and leave in rent controlled houses.
Rent controls affect the communal factor in that landlords are forced to receive low rent income and therefore they are not motivated to maintain good housing standards to the tenants. Tenants on the other hand are not proud of the housing facilities given to them by the landlords and they have no opportunity of requesting for improvement.
Rent control causes high demand for houses which makes the tenants to be desperate and willing to do anything so as to secure a house. This makes them even to sacrifice their integrity to get a house in their desired locations.
Stewardship involves the comfort of others and doing things with a clear conscience. Rent controls may force landlords to engage in unethical practices when taking care of the housing facilities they have given to the tenants. This is mainly due to the low incomes they receive from their investment that makes them want to find other ways of increasing the revenue.