Housing Policy

Bernie Sanders' Housing Plan Calls for $2.5 Trillion in New Spending and Nationwide Rent Control

The socialist presidential candidate wants the federal government to take the lead in regulating rental prices and building new rental housing.

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Sen. Bernie Sanders (I–Vt.) has released an ambitious housing plan that stays true to the candidate's interventionist brand of democratic socialism.

In a speech to trade union members in Las Vegas, Nevada, on Saturday, Sanders laid out his vision for tackling high housing costs, homelessness, and gentrification through a mix of nationwide rent control, increased federal spending on housing vouchers and public housing construction, and higher taxes on the wealthy.

"I don't have to tell anyone in America that we have an affordable housing crisis in Nevada, in Vermont, and all over this country that must be addressed," Sanders said. "It is unacceptable to me that over 18 million families in America today are paying more than 50 percent of their limited incomes on housing."

The most radical part of Sanders' plan is his call for a nationwide cap on rental prices above one and a half times the rate of inflation, or 3 percent, whichever is higher.

That's much lower than the rent increases allowed by either California or Oregon, which both passed statewide rent control policies this year, limiting rent increases to 5 percent plus inflation and 7 percent plus inflation, respectively.

Those laws also included exemptions for housing constructed in the last 15 years in order to mitigate the laws' effect on new development. The full version of Sanders' plan has yet to be released (it is apparently coming in the next few weeks), but he has so far made no mention of any exemptions to his proposed rent caps.

Rent control has long been derided by economists as a well-intentioned policy that comes with a host of unintended consequences: Limiting the return developers can make on new housing construction disincentivizes them from building more units. Some landlords, unable to pass on the costs of repairs or renovations to tenants, let their buildings deteriorate. Others might convert their regulated rental units into more expensive condominiums that can be sold at any price, reducing the overall supply of rental housing.

That's exactly what happened in San Francisco following an expansion of rent control in the 1990s, according to a recent study published in the journal American Economic Review. Building owners took their units off the rental market, resulting in citywide rent increases and increasing gentrification.

Housing investment has boomed in places like Toronto and Cambridge, Massachusetts, after rent control laws governing those jurisdictions' were repealed or nullified.*

Sanders is also calling for $2.5 trillion in new housing spending over 10 years that will be paid for by a wealth tax on the top 0.1 percent of families.

Details on how exactly this money would be spent are a bit spotty. It would include $32 billion over the next five years to "end homelessness," $70 billion to repair and expand the country's stock of public housing, and $50 billion in aid to local and state governments to enable the creation of community land trusts.

Sanders is promising to build or rehabilitate 7.4 million units of housing for low-income people, seniors, and the disabled, all of which would be funded by a permanent expansion of the federal Housing Trust Fund. His plan also calls for funding the creation of an additional two million units of mixed-income housing.

Though hardly optimal, Sanders' public housing construction spree would theoretically help mitigate a drop in private housing investment created by the rent control portion of his plan.

Nevertheless, building the number of new units the senator is calling for would require local and state governments to repeal their own restrictions on new housing development, a policy Sanders has yet to embrace.

Building affordable housing in expensive cities is not, well, affordable. That's because the same land costs, impact fees, union hiring and wage requirements, and restrictive zoning laws that make private development difficult also hamstring government and non-profit developers.

The median cost for building a unit of affordable housing in California is over $300,000, and individual projects in the Golden State have seen per-unit costs surpass $700,000.

So long as these rules remain in place, the level of public housing construction Sanders is calling for just isn't going to happen.

On the other hand, repealing rules that would prevent massive amounts of public housing being built would also probably make that public housing unnecessary, as a surge in privately funded housing development would start to bring prices down.

Places like Houston and Dallas have been able to stay relatively affordable by keeping their restrictions on new housing and suburban sprawl to a minimum. Seattle has seen modest rent decreases as a result of its upzoning land in and around its urban core.

Internationally, growing Tokyo has managed to keep rents mostly flat by having what's been described as "a free trade zone" for new development.

Sanders is not wrong to point out that many areas of the country suffer from major housing affordability problems, but that's not because we've failed to build enough public housing. It's because we've failed to build enough housing period.

Deregulating housing construction would ease affordability problems where they exist, and could be done without all the taxes and inefficiencies that will inevitably come with the federal government-led initiative Sanders is proposing.

Correction: The original version of this article said that Cambridge, Massachusetts repealed its own rent control law when in fact it was nullified by a state ballot initiative. 

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  1. Sanders should be pushing punching bag control.

    1. Sanders should be tried and executed for being a communist traitor. Then the other democrat candidates.

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  2. Is Comrade Bernie going to expend $2.5 Trillion in HIS own personal labors and materials to git ‘er done?!?! Or is He gonna sit on His fat dumb old ass in His $7 million mansion and command the peons to “get ‘er done”?

    If’n it’s the latter… Which would SHOCK and SURPRISE me utterly!!!… Then I wish the slaver would FUCK OFF!!!!

    1. Squirting squirrel shit all over ever thread today…

      1. Chuckles the Snarky Piggy loves and adores Stalinist Uber-Booger commies then I take it?

        Did Comrade Stalin wear magic underwear? Does Comrade Bernie wear magic underwear? If not, then HOW is Comrade Bernie going to PROTECT us from evil coffee and tea?

        1. Right but you eat shit. You actually eat actual shit.

          1. Apparently, there is some quantity of shit he reserves for throwing at people who call him on shit.

            You might have noticed the ‘anyone that criticizes me must believe [insert ad absurdum fallacy here]’, which is straight out of the Progressive playbook. Unfortunately, I fear that ‘shit-eating crazy’ is the new normal.

            1. Chuckles the Snarky Piggy
              September.16.2019 at 3:42 pm… Blah…

              Go fuck yourself, shit-eater. (Quoting shitweasel from another thread).

              There you are, persecuting my for my religious beliefs as a shit-eater, obeying the Sacred Holy Bible!

              https://lavatoryreader.typepad.com/the-lavatory-reader/2009/10/eating-faeces-and-drinking-urine-in-the-bible.html

              Buttercup hypocrite snowflake can’t handle it when the shit that HE deals out, comes back to HIM! Buck up, whining crybaby prima donna shitweasel!

              Go and cry in your magic underwear, Moroni-worshipping moron!

              1. Hypocrite? Snowflake? Your response to my comment that included:

                You might have noticed the ‘anyone that criticizes me must believe [insert ad absurdum fallacy here]’

                is, in effect:

                ‘guy that criticized me said [insert out of context quote here] [insert revisionist explanation of original criticism here] [insert ad absurdum fallacy here] [insert insult in violation of prior stated principles here]’

                You must have taken your meds this afternoon and you clearly revisited your notes from Troll as a Second Language PROG242. You have transitioned back from crazy and pitiful to just plain ignorant and tedious. Ugh, you bore me.

                1. He’s too busy eating poop to respond.

  3. Although I’ll vote for him if he gets the nomination, it’s clear Sanders is often bad on economic issues. But what else would you expect from someone who made the absurd claim that “Open borders is a Koch Brothers plot to drive down wages”?

    He should consider dropping out and endorsing Harris or Warren.

    1. “He should consider dropping out and endorsing Harris or Warren.”

      Nah.
      Comrade Bernie should drop out and endorse his best friend, Maduro.
      They have so much in common.

  4. In a speech to trade union members in Las Vegas, Nevada, on Saturday, Sanders laid out his vision… “I don’t have to tell anyone in America that we have an affordable housing crisis in Nevada,

    And Bernie wants to export that unaffordability nationwide by empowering trade unions.

    1. The best part is that there is no crisis in Nevada. They built far too much in the lead-up to the housing collapse and there aren’t many cheaper places in America to rent an apartment, especially if you want to be near an urban center. Vermont isn’t far behind.

      1. Comrade Bernie’s line about an affordable housing crisis in Nevada is complete horseshit. Two years ago I had a new construction house built in urban Nevada whose cost per square foot was 20% of that of my little shoebox condo in downtown San Francisco. It is easy to build in Nevada — endless empty land and no Commiefornia style government (yet). Bonus is that energy is way cheaper here too so I get to blast the AC to cool my gigantic house in the desert without feeling like I’m being gouged.

  5. Why is Bernie so against immigrants having a place to live?

    /sarc, but I’m sort of surprised that wasn’t the gist of this article.

  6. It’s amazing that he thinks stealing $2.5T of new taxes can somehow make the taxpayers better off.

    “Let’s insert an entire layer of new middlemen into this corner of the economy to make it more efficient, and oh BTW distort the pricing mechanism beyond recognition so no one can show how much more inefficient we made it.”

    1. and no way will rent go up when renters have an extra 600 billion or so to spend on rent (after government middlemen take their 1.9 trillion dollar administrative fees)

  7. Sanders is not wrong to point out that. [M]any areas of the country suffer from major housing affordability problems, but that’s not because we’ve failed to build enough public housing. It’s because we’ve failed to build enough housing period.

    FTFY

  8. Ugh. Rental prices aren’t the driver of housing prices. It’s the other way around. If you’re going to put price caps on anything, how about property tax control?

    1. that’s not it either. rental prices are driven by wages. housing prices are driven by supply, homebuyers, and investors chasing the next bubble. In some markets monthly rents are way lower than mortgage costs, and in some markets they’re higher.

  9. It’s the old saw: the government can always do better what the private sector can do.
    For example: crowd out the private sector.

  10. No one should forget that a wage is nothing more than the rent of labor.

    So social liberals support minimum rents of labor and maximum rents of housing.

  11. Ugh. Sounds like an awful lot of statist crap.

    1. Don’t you have an ad hominem to make somewhere else?

      1. What ad hominem?

      2. Now, now. Pedo Jeffy is generous enough to take time between jacking it to kiddie porn and moderating his NAMBLA cell’s chat room to post here.

        Darned kind of him.

  12. According to reports, Bernie’s got three houses. Why hasn’t he invited some homeless people to move into two of them? It’s not like he can live in more than one at a time. Right?

  13. “”I don’t have to tell anyone in America that we have an affordable housing crisis in Nevada, in Vermont, and all over this country that must be addressed,” Sanders said.”

    Aren’t you the senator from Vermont, Bern? You haven’t been able to solve the problem in your state, but you’re going to fix things nationally with a one-size-fits-all policy?

    What a maroon.

  14. You just pay for it.

  15. A simpler fix for people not having a cheap place to live would be just to install canopies and benches on the breadlines where we’ll be spending most of our time anyways.

  16. Once you’ve spent the baseline 5 trillion for day to day government operations, and 3 trillion for climate change and 1 trillion for graduate student debt forgiveness and 2.4 trillion for Universal Basic Cash Transfer, what’s another 2.5 trillion for affordable housing? Not to mention the ease and convenience of turning every neighborhood Post Office into a low interest payday lender?

    1. I think if you add all those up (plus the ones I missed), you’re approaching GDP. But then you have to subtract government spending from GDP, since it can’t be the source of its own revenues.

    2. See, this is the kind of thing that I fear more than OMG SOCIALISM – that all of this runaway spending will lead to a financial panic that this nation hasn’t seen in a long time. When the world finally loses confidence in the dollar as the world’s reserve currency, because everyone else finally realizes that our government is a stupid incompetent mess that shouldn’t be trusted with a piggy bank let alone trillions of dollars, then the financial chickens really will come home to roost. When that happens, then what?

        1. You think it’s funny?

          1. I think you’re funny.

            1. How so?

              1. In a kind of buffoonish, clueless, idiotic way. Think ‘Roger’ from ‘American Dad’ or some other Gilligan type idiot. But who also champions foreign criminals who are violent sexual predators.

          2. I do think it’s funny that you don’t seem to realize that pretty much everyone who identifies as socialist is promoting that kind of spending.

      1. Our government? Pedo Jeffy! We’re talking about America here, not Canada.

    3. A trillion dollars here.
      A trillion dollars there.
      But, hey, who cares?
      It’s not Comrade Bernie’s money he’s spending like a drunken sailor.

    4. That sounds like a Plan! Maybe you could target it for Five Years?

  17. Bernie needs to go to Venezuela and work his magic there. How about we start a crowd-funding effort to pay his airfare. We can set a target, and Bernie’s plane will take him as far as the percent of the fund-raising goes.

    1. It’d be a real shame if the funds ran out somewhere over the ocean. I’d lose a lot of sleep over that.

  18. what an insufferable cunt this moron is.

  19. rent-controllers are the flat-earthers of the economics world.

    1. Stealing that.

    2. I don’t mean to damn with faint praise, but thread winner!

  20. Bernie the brainless! Price controls ALWAYS LEAD to shortages. FDR, Nixon ? Need I say more!

  21. These proposals are not democratic socialism; they are Communism, pure and simple.

  22. This is just an interim plan. Once Bernie’s vision is fully implemented we’ll all have the same accommodations: a bunk in the Worker’s Barracks.

    (Except for Party members of course. They need their privacy!)

  23. Gunnar Myrdal stated, “Rent control has in certain Western countries constituted, maybe, the worst example of poor planning by governments lacking courage and vision.”

    His fellow Swedish economist (and socialist) Assar Lindbeck asserted, “In many cases rent control appears to be the most efficient technique presently known to destroy a city—except for bombing.”

  24. So Bernie wants to tell me how much I can charge for the rental properties I own. What’s his next big idea? Single-maker toothpaste? Oh…wait….

    Are the democrats really too stupid realize that proposing this kind of law, are the kinds of ideas which will guarantee Trump’s reelection?

  25. The old mans timing is off. Gullible people might have bought this nonsense 10-11 years ago when it seemed like the financial world was falling apart. Next crash could bring in someone like him. Yikes!

  26. “The socialist presidential candidate wants the federal government to take the lead in regulating rental prices and building new rental housing.”

    Too late, Comrade Bernie.
    They government has already done that.
    These areas are called, “the projects,” and we all know what wonderful place they are to live in.

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