I am in a rent controlled building in SF. Our building recently got sold and the new owner evicted the lowest paying tenant. She (the new owner) has to live in the unit for two years before she can re-rent the unit, but considering the previous tenant had been there for 15-20 years, the increased rent she will get after those two years will more than make up for the lost rent (assuming that is her intention). Additionally, she is starting to repair/update the building. I was initially excited about this (the building is a bit old/outdated), but after reading the rent control laws, found out that she is allowed to pass on 100% of the cost to the tenants (through a 5% annual increase until the costs are paid off), and additionally, can deduct 100% of the cost from her taxes. Also, I found out what the sale price of the building was, and after doing a little back of the napkin calculations, realized that her mortgage is probably going to be less than what she collects in rent from the remaining two tenants. So for the cost of the down payment, the landlord is getting a place to live, all of the building upgrades paid for by the tenants, the mortgage paid for by the tenants, and a small income from what is left over from the rent as well as any capital gains on the building. This sounds like a pretty good deal (and I was actually upset that I didn't move on it myself).

I agree with the sentiment that rent control can result in an increase in market prices. But it's not as if the landlords are getting completely screwed, they still have avenues in which they can evict tenants, profitably upgrade the building, and achieve close to market rents. Additionally, a major factor that gets overlooked in the rent control debate is that the 'secondary market' (rooms for rent in rent controlled units) provides fairly affordable housing for young newcomers. Almost everybody I know who lives in SF does so by renting a room in a rent controlled unit that they found through friends or through craigslist. These rooms are significantly cheaper than market rates (rent control by-laws actually require that any rooms in a rent controlled unit must be re-rented at an evenly split price, or normalized price based on square footage, not that everyone abides by those rules), and probably the only reason people with marginal means can afford to live here. So, while rent control may result in an increase in market prices, it also creates a secondary market that allows for economic diversity to continue to exist in SF.

I am somewhat split on rent control, but my gut feeling tells me it is the right thing to do. Allowing landlords to arbitrarily raise rent or randomly evict tenants is unfair and disruptive to people's lives. Rent control allows for a secondary market that lets young and lower income folks get a foot in the door. I think the 'lazy rent controlled tenant who pays nothing because they lived there for 30 years' is largely a myth (or such a rarity that they have only minimal impact on the macro trends) because rent control still allows for evictions, just with a bit more red tape. Also, another factor that doesn't get discussed is the effect of rent control on a downward market. Because rents aren't ruthlessly increased to market rates during the boom times, it means people who get laid off in the bad times can actually afford to stick around and look for a new job for a while, rather than having to lift anchor and move somewhere cheaper. From what I recall, the vacancy rate in SF rose a little bit during the great recession, but no where near as bad as other places.