THE INTERDEPENDENCE OF RENTS IN THE REGUL ATED AND THE UNREGULATED SECTOR OF THE DANISH HOUSING-MARKET

The Danish housing market is characterized by partial vent control. It is shown that rents (and prices) in the unregulated sector are depend ent on the sorting mechanism and rationing of households allowed to th e controlled sector If households in the controlled sector ave not rat ioned in their demand for housing, the vents in the uncontrolled secto r will be higher than without rent control. Also, it is shown that an increase in the controlled vents will decrease the vents in the uncont rolled sector under the same conditions.