Toward a Sociology of Rent: Are Rental Housing Markets Competitive?

We critically examine conventional economic models which assume that urban rental markets are competitive and that rent levels are determined solely by the supply and demand for housing. A review of previous research on local housing markets indicates that social factors—such as the high degree of organization among professional landlords—restrict competition and affect the price of rental housing. We present a regression analysis of 1980 median rents in 140 urban markets which reveals that demand variables and the professionalization of the rental housing industry are more important determinants of rent levels than are supply variables. We conclude that a sociological approach is necessary to understand such problems as a lack of affordable housing in urban areas and structured inequality in the tenant-landlord relationship.