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Davis’ draft law legalizing rent control should be consigned to the dustbin
With less than one year to go until Chicago’s mayoral election, Mayor Brandon Johnson has spent a considerable amount of time exalting his record in his first three years in office as he draws closer to officially announcing his intent to seek reelection. A signature policy achievement, Johnson insists, is affordable housing. Record-high rents have left many Chicago residents searching for relief so it is not surprising Johnson has found strong support among housing advocates.
While a fragment of Johnson’s energy on affordable housing has concentrated on his “Cut the Tape” initiative and throwing his arms around tenants’ rights groups which backed his bid for mayor, most of the mayor’s gambit to address housing affordability is found in the 2024 $1.25 billion Housing and Economic Development Bond. A bond in which the mayor lent money at a loss to politically connected affordable-housing developers to build obscenely overpriced units — an average of $700,000 per unit — the mayor’s fiscally illiterate plan will never yield the needed housing supply.
Recently, Mayor Johnson has amplified his calls for rent control, and the mayor’s progressive allies in the Illinois General Assembly (IGA) are listening. Under a bill advanced by Representative William Davis (30) — HB 5765 — municipalities would be empowered to broaden its authority to impose more fees and regulation over the real estate industry and, worse, give authorization to local governments to approve rent controls.
Despite his newfound predilection for rent stabilization, if Mayor Johnson is intent on expanding affordable housing, he would be best served to resist Davis’ bill. Rent control would be a calamity for Chicago. A suffocating regulation, rent control reduces supply, drums out investment, and hinders property owners from maintaining buildings and units.
Let’s specify up front rent control may sound good politically, but it is an atrocious economic concept. Though rent control is appealing to progressives, it ducks if not outright hurts the very low-income families or rent-burdened tenants it intends to help. Moreover, rent control tends to favor the relatively privileged, tightens the housing market, and invariably leads to higher rent prices.
With the IGA weighing a bill to allow rent control, it will be helpful to frame the issue with hard, uncontested facts. While high rents may symbolize accomplishment, the foundation of Chicago’s problems with housing affordability are located in Chicago’s high tax burden, excruciating restrictions on housing providers, and an endless raft of Chicago and Cook County laws — primarily the Residential Landlord and Tenant Ordinance or application fees — which drive up operating costs.
Consistent with any commodity, or price, rent increases when the demand eclipses supply. While Chicago’s real estate sector has recovered from a tumble during COVID, the rebound has lagged behind other large urban areas across the nation. Only recently has Chicago’s real estate revival balanced itself with competing cities. The flywheel driving this rally is Chicago continues to be a desirable place for college graduates to settle and build a career. A city with unrivaled career prospects, Chicago also offers a teeming cultural scene, with learned societies, organizations for the arts and sciences, and educational establishments for those relocating to the city. The disadvantage, of course, is high rent. It should come as no surprise to homeowners and renters, one year after a sharp rise in city property taxes, rents rose significantly.
Woefully, housing construction — the needed supply — has failed to meet demand. While Mayor Johnson is keen to advertise his commitment to affordable housing, in 2025, the City of Chicago issued a mere 4,039 residential permits, of which 321 were for single-family homes. In contrast to the Windy City, the City of Houston approved over 52,000 residential building permits in 2025. Complicating matters, as our colleague Paul Vallas pointed out in April, last year Chicago ranked near the top among cities with the highest growth in rent — between 4.4-6 percent — with an average rent of $2,461, which is $700 above the national average. Though permits are issued, there is no guarantee a development project will eventually be built.
While it is tempting to dismiss the sluggish pace of construction on high material cost, architectural and engineer design, or bottlenecks in government approvals process, significant barriers to construction or conversion are found elsewhere. One primary reason for slow growth of building is Chicago’s rickety finances. Municipal debt and credit downgrades discourage larger developers from embarking on the development of substantial construction projects.
Another reason for the housing shortage is Chicago’s political leadership’s inclination to source lousy housing policy practiced in cities across the country. A “cut, copy, and paste” practice, Chicago has ignored the downstream effects of bad housing policy it has adopted from other municipalities.
Last, though many neighborhoods are fit for development, homebuilders are increasingly cautious when confronted with the prospect of facing withering criticism from community groups over the virtue of investment in blighted neighborhoods. Accusations of gentrification lack force and its benefits are often unsung. The political Left in Chicago routinely bemoans the absence of investment in historically non-white neighborhoods, white flight, and economic segregation. Gentrification, however, straightforwardly reverses each of those trends.
Further aggravating these conditions is the fact over the past decade Cook County, and Chicago have passed laws which erode basic protections for landlords or property managers, mainly narrowing the circumstances under which tenants can be evicted. More troubling, these City and County laws hamstring property owners’ ability to manage their properties effectively, cause operating costs to soar, and lead to antagonism between tenants and housing providers.
The consequences of these laws have been staggering: Many small landlords have removed rental units from the market rather than continue to lose money or tolerate nightmare tenants.
All of these conditions are causing housing distress. Chicago’s leaders have reached a critical juncture: Will the mayor and lawmakers in the City Council partner with progressives in the IGA to advance this draft law favoring rent control or will they enact needed reforms which will increase the housing supply and influence developers to undertake larger construction projects?
The answer is to take measures to step up development. While Chicago addressing its wobbly finances, assuring the public gentrification is not a curse word, and deploying inventive housing policy is a good start, more is required to build greater housing stock.
First, the city’s permit process is agonizingly slow. For example: 40 percent of Chicago is zoned for single-family homes. Allowing duplexes, triplexes, and accessory units (ADUs) in these areas would exponentially increase supply. However, since ADUs were authorized in 2021, Chicago had approved only 400 total ADUs through the end of 2025. This is not a problem of development, but a slow-moving bureaucracy. To crank up permits, the solution is to dismantle Chicago’s Byzantine system of zoning laws, building permits, and inspections which disrupts development. To reduce the backlog in environmental or safety inspections, Chicago should consent to third-party inspectors.
Among other measures, Chicago should also consider tax abatements for developers and low and moderate-income homebuyers to stimulate investment and developments. The Chicago City Council should also weigh caps to property taxes for long-time residents to prevent displacement. Likewise, Chicago could also create automatic upzoning for vacant parcels suitable for development and reassess the requirement for affordable housing units from 20 to 10 percent.
If Mayor Johnson is serious about building the “safest, most affordable big city in America,” his vision for Chicago will never be realized with rent control. To achieve his vision for increased housing for the Windy City is for Chicago to preach the decency of developers, fix city finances, and reform misguided city rules.
