Rent controls force landlords to price apartments below the equilibrium price level. An immediate effect is a shortage (excess demand) of apartments, because the quantity of apartments demanded is greater than the quantity supplied at the regulated price.
When cities prevent landlords from charging market rents, which of the following are common long-run outcomes? Please say all that apply.
1. The quantity of available rental housing units falls.
2. Efficient use of housing space results.
3. The quality of rental housing units falls.
4. Black markets develop.