Rent control proposal could cost Massachusetts billions in lost property taxes, study finds

Rent control in Massachusetts could lead to big losses in city and town budgets, according to a new study released Thursday.

The Greater Boston Real Estate Board and the Center for State Policy Analysis at Tufts looked at the potential impact of the proposed 2026 ballot question. They found it would cost Massachusetts billions of dollars in lost property taxes.

"Every town will see an impact"

"We cover all the ballot questions, and we don't take a stance, but we follow the evidence and this evidence is really clear about the impact on municipalities," said Evan Horowitz, the executive director of the Tufts center.

He told CBS News Boston municipalities would have to make difficult decisions.

"No one is spared. Every town will see an impact," Horowitz said. "You collect less, you spend less on police, on fire, on parks, on snow removal, that kind of stuff, on schools or you raise tax rates."

The proposed ballot question would cap annual rent increases at five percent per year across Massachusetts.

Owner-occupied buildings with four or fewer units would be exempt, as would newly constructed buildings for the first ten years.

"This does not prohibit landlords from raising the rent year over year, but just simply sets a limit on how much they can raise the rents. So we see this as something that can continue to strengthen our communities," said Carolyn Chou, the executive director of Homes for All Massachusetts.

Rent control and housing constrcution

Massachusetts Gov. Maura Healey is opposed to rent control.

"We're trying to build homes as quickly as possible in this state. Rent control, as proposed in that ballot question, has already halted housing production in our state," Healey said Wednesday.

"There is some evidence that cities that have implemented really strict rent control have seen construction slow, have seen property values drop. But then, that trend kind of reverses when they begin making exceptions for new construction for a couple of years, which this measure has," said Stephen MacLeod of the Boston Business Journal.

Supporters need to collect enough signatures by the deadline in July to officially get the rent control question on the November ballot.