What is "rent control"?

Rent control refers to regulations set by government authorities that limit the amount landlords can increase rent on residential properties annually. This system is designed to provide affordable housing and protect tenants from significant rent increases that could otherwise lead to displacement or financial strain. Rent control aims to maintain stability in housing markets and promote long-term tenancy by ensuring that rent increases are moderate and predictable.

These regulations can vary widely depending on the municipality and may include specific caps on annual increases, as well as guidelines for how much rent can be raised when a unit becomes vacant. By controlling rent increases, cities seek to balance the interests of both tenants, who need affordable housing, and landlords, who require a reasonable return on their investment.

Other options present ideas that do not accurately reflect the nature of rent control. For instance, the notion that tenants dictate rent prices overstates tenant power and overlooks the regulatory framework involved. The idea of a subsidy program focuses on financial assistance rather than controlling rent levels. Lastly, a contract between tenants and landlords regarding rent adjustments seems more aligned with lease agreements and negotiations rather than the formalized, enforced regulations of rent control. Thus, identifying that rent control is fundamentally about limiting landlords' ability to raise rents annually aligns accurately with the established definitions of these policies.