Rent controls reduce rent. Some argue that market forces also reduce rents. So why are the arguments about what happens next so contradictory in these cases?
I guess the argument would be that competition reduces prices through an iterative and dynamic process, so a first mover captures rents and then prices gradually get bid down. It's a classic fallacy of composition/coordination problem that it's profitable for an individual firm to reduce prices but it will damage them all in the long run.
Your third argument is flawed. Higher rents might not benefit owners if the total housing stock is low. Upzoning can easily benefit both renters and owners (assuming supply increase).
Surely if upzoning benefits renters by lowering the rental price for all housing, then owners of all the existing homes will not benefit, but lose out (unless there is a way that developers or new homes compensate the owners of existing homes, or some such thing).
The owners of existing and not yet existing homes are not distinct groups.
Existing homeowners might be better positioned to benefit from an increase in the overall market size.
Specifically to your point on lobbying, bigger players where the interests are concentrated, the ones that are expected to lobby, are also likely to be better positioned to benefit from an increase in the rental market.
I guess the argument would be that competition reduces prices through an iterative and dynamic process, so a first mover captures rents and then prices gradually get bid down. It's a classic fallacy of composition/coordination problem that it's profitable for an individual firm to reduce prices but it will damage them all in the long run.
Equating market forces to rent controls is also flawed. The difference is that in the latter case the effect is exogenous.
The former can simply be a consequence of shifting preferences, saving rates, or what have you, a symptom of organic changes in the market.
Your third argument is flawed. Higher rents might not benefit owners if the total housing stock is low. Upzoning can easily benefit both renters and owners (assuming supply increase).
Surely if upzoning benefits renters by lowering the rental price for all housing, then owners of all the existing homes will not benefit, but lose out (unless there is a way that developers or new homes compensate the owners of existing homes, or some such thing).
The owners of existing and not yet existing homes are not distinct groups.
Existing homeowners might be better positioned to benefit from an increase in the overall market size.
Specifically to your point on lobbying, bigger players where the interests are concentrated, the ones that are expected to lobby, are also likely to be better positioned to benefit from an increase in the rental market.