Cost to the Jurisdiction

In most jurisdictions, an administrative agency such as a Rent Board or an Office of Rent Administration is established to administer and enforce rent control laws.  The costs of operating the agency are borne by the agency,  the local government, or by both.  These costs may include:

• a paid full-time executive director, rent administrator, and other staff such as an administrative assistant;
• compensation for members who are elected or appointed to such boards (some agencies are staffed by volunteers);
• an attorney for the agency;
• facilities and other services.

These costs are usually funded through the municipality's regular budgetary process or through special funds created to maintain the operation of these agencies (such as revenue generated from administrative fees).  For example, in New York , a state agency (the Division of Housing and Community Renewal) administers the rent control law and operating costs are subsumed in the state budget.  In some jurisdictions, the rent control law requires landlords to pay registration fees based on the number of rental units they own and these fees are then used to finance the operations of the agency (see above: Draft a Strong Rent Control Law).

Cost to Landlords

Rent control denies unlimited, excessive rent increases, thus limiting  profits.   Rent control does, however, allow for annual increases that provide owners a fair return on investment with sufficient income to maintain property in a satisfactory manner (i.e.  income sufficient to cover operating costs and to make repairs  in compliance with health and building codes). 

Rent control laws usually include provisions that protect a landlord's investment in these ways.  For example, the law usually defines "fair return" and provides landlords with a "hardship" appeal process if circumstances change and the landlord is no longer receiving a fair return on the investment (see Draft a Strong Rent Control Law).

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