Rent Control in Santa Monica

The article on Santa Monica’s rent control (Part I, April 29) was most timely since the Los Angeles City Council is at present considering a more stringent rent control ordinance. There is one characteristic of Santa Monica’s experience that has counterparts in two other cities with rent control: a diminishing supply of rental housing.

Economic theory teaches that by holding down by law the price of a product below the free-market price, the result is a lowering of the profitability of producing that product. This brings about less of the product being produced--a shortage. If the product is rental housing, then under rent control we can expect fewer rental units being built or put on the market. The examples of Santa Monica, New York, and Berkeley bear this out.

According to the Times article, rent control in Santa Monica, though intended to preserve affordable rental housing, actually has resulted in the loss of 100 units a month. New York City, which has had rent control since World War II, has been losing upwards of 30,000 rental apartments per year since the mid-1960s (mainly through outright abandonment by the landlords). Berkeley, which has a rent control law very similar to Santa Monica, has been losing over 500 unit a year since 1978 (the year the ordinance was approved by voters).

It is important for the consumers of rental housing--the tenants--to realize that rent control is contrary to their interests. It is not time for more rent controls in Los Angeles, contrary to the view of some city councilmen. If anything it is time for less control. With a free market in housing, people of all income levels will have a supply of housing ready for them to rent.

RICHARD SHEDENHELM

Van Nuys