According to economic theory (and supported by empirical evidence), rent control laws have many adverse consequences, including, among others, a) the inefficient use of housing space and much lower turnover of housing units, and b) long-term renters benefit signifcantly, but at the expense of newcomers.
One of the legacies of former NYC mayor Ed Koch (1924-2013) is that he provided a classic, textbook example (see Thomas Sowell’s Basic Economics book) of the adverse consequences and inefficiencies of rent control laws - he kept his $475 per month rent-controlled apartment in Greenwich Village for the entire 12 years (1978-1989) that he lived in Gracie Mansion, the official residence of NYC mayors. It was estimated that the market rent for his apartment was about $1,200 per month, so there was an incentive for Mayor Koch to leave his apartment vacant for 12 years, pay the below-market rent for more than a decade, and then move back into his apartment after leaving Gracie Mansion.
But leaving a Greenwich Village apartment vacant for 12 years, in a city with extremely high demand for rental housing, illustrates how the perverse incentives of rent control laws increase housing shortages and make fewer rental units available for newcomers. In the absence of rent control laws, it’s likely that Mayor Koch would have given up a market-priced $1,200 per month apartment for the 12 years he was living rent-free in Gracie Mansion, and that apartment would have then been available for somebody else. However, under a system of government price controls at rents that are mandated to be significantly below the market, a very valuable and highly desirable apartment sat vacant for more than a decade in NYC.