Removal of rent control and impact on search and mismatching costs: evidence from Oslo (July 2017)

• The removal of rent control and its impact on search and mismatching costs: evidence from Oslo

• By Are Oust. Published online on the International Journal of Housing Policy on 20 July 2017

• https://doi.org/10.1080/19491247.2017.1336876

• Abstract:

  • The removal of the Norwegian rent control in 1982 created a natural experiment that enabled us to investigate whether rent control affected the search and matching process in the private residential rental market in the Norwegian capital, Oslo.

  • We collected and analysed data on ‘housing for rent’, ‘housing wanted’ and ‘housing exchange-wanted’ advertisements in Oslo covering a period from 1970 to 2008.

  • We concluded that the use of newspaper listing services by potential tenants and landlords changed after the rent control removal.

  • Our results indicate that it is more costly, in time and money, for a potential tenant to search for and to find a home under rent control.

  • Moreover, our results indicate that rent control increases the probability of and the distance from the ideal dwelling, in size, standard and location, a potential tenant have to settle for.

• Keywords: rent control, tenants, Oslo, Norway