Preferences for Rent Control: Between Political Geography and Political Economy

Abstract

Following geographically concentrated changes in housing markets, real estate prices have skyrocketed in many cities and metropolitan areas across Germany. These developments have not only shifted the macro-level distribution of asset wealth among homeowners but have also resulted in price spikes in rental markets, which in turn have intensified social and economic risks among renters. This preregistered study aims to provide a theoretical rationale for, and first-time insights into, the determinants of individual preferences for rent control. It argues that policy preferences are shaped by individuals' economic and geographic positions in the housing market. It not only explores differences between homeowners and renters but also considers how heterogeneity in exposure to the burden of rental costs - structured by local rents and disposable income - explains differences within the group of renters. The results reveal the precedence of egotropic considerations over geotropic effects of common market exposures. Homeowners oppose rent control far more strongly than renters do, whose support for rent control is primarily a function of income. Market rents, in contrast, only heighten support for rent control among low-income renters. These findings deepen our understanding of the politicization of housing policy in Germany and advance important debates on political reactions to housing markets.