Question

Can you propose a policy that would induce the

market to supply more rental housing units?

Short answer

1. Reduce property tax

2. Lower price of building permits

Step-by-step solution

Step 1.1. Reduce property tax

Property tax is the annual amount paid by a landowner to the local government or the municipal corporation of his area.

A cut in property tax makes it inexpensive for landlords to purchase more houses and rent them out with some discount or at a lower price which in turn incentivizes consumers to rent houses.

Step 2.2. Low-priced and timely building permits.

Getting a building permit to build apartments takes a lot of time and money. So if the permits are lower in price and ease of access to permits is increased. Therefore the timely implementation of the building is possible and then it is rented.