Mexico City Approves New Rent Control Law

Mexico City's legislature has passed a significant rent control law, the first of its kind since the 1940s, limiting annual rent increases to the previous year's inflation rate, currently at 5.57%. This legislation mandates that all rental agreements be registered with city authorities, addressing rising concerns over housing affordability exacerbated by an influx of digital nomads and short-term rentals. The bill, which received a unanimous vote of 57-0, aims to combat skyrocketing rents that had increased eight times the minimum wage between 2013 and 2019. However, critics warn that the law may deter investment in new housing construction, worsening the existing shortage of approximately 800,000 housing units in the city. While proponents argue that housing is a right, the law does not provide solutions for the underlying issues of land availability and property shortages. The new measures reflect a complex history of rent control in Mexico City, where previous regulations have led to abandoned properties due to unsustainable rental income.