At her first major rally as the Democratic frontrunner, Vice President Kamala Harris threw down the gauntlet, vowing to “call out corporate landlords and limit unfair rent increases.” In front of 10,000 supporters in Atlanta, Harris unveiled a bold idea: capping rent increases at 5% for landlords with more than 50 units for two years.

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This proposal is closely aligned with a plan the Biden administration recently put forward. That plan aims to curb rising rents while more housing is built. However, the Biden plan would exempt newly built units so as not to hamper development. Harris did not address that nuance in her speech. The proposal targets commercial landlords and is seen as a way to provide immediate relief to millions of renters, especially in markets where housing affordability is becoming increasingly critical.

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Her message is resonating with voters who are suffering from rising housing costs. A May poll by the Democrat-aligned group Navigator found broad support for curbing rent gouging by corporate landlords. These voters are crucial to the Democratic base. But while she is scoring points in the election campaign, economists are raising alarm about the plan.

Most economists agree that rent controls like Harris’ plan often do more harm than good. A review of over 200 studies on rent controls found many negative consequences: lower housing quality, reduced availability, and a decline in new construction. Rent caps can shrink the housing supply and worsen conditions in existing rental housing.

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Even some Democrats, like Colorado Gov. Jared Polis, warn that Harris’ approach could backfire and worsen the housing crisis it is supposed to solve. They argue that the real solution lies in creating more affordable housing, not just rent caps.

“Rent control has fallen out of favor like no other economic policy in the toolkit,” Jason Furman, the Obama administration’s top economic adviser, recently told the Washington Post. “The idea of ​​reviving it and expanding it will ultimately make our housing problems worse, not better.”

Harris is betting that rent control will eclipse those concerns. With more than 22 million American households spending more than a third of their income on rent and mortgage rates rising recently, the housing crisis is worsening. As her campaign continues, Harris may face increasing pressure to balance voters’ demands with the economic pitfalls pointed out by critics. Whether that gamble will pay off electorally or cause long-term problems for the housing market is still uncertain.

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