Prices for rent are such a weird ratchet effect, they may only go up. It basically shows that landlords really aren't that interested in being efficient market actors, it's also about validating their own egos (even on an institutional level). If prices were to decrease, then they may see a direct loss of revenue, versus an empty unit which is simply an "unrealized asset"
I imagine marginal costs of occupation like wear & tear, utilities carried by the landlord, and so on would increase that loss of revenue you mention, and push the calculus even farther towards letting it sit unoccupied.
Commercial property mortgages and valuations are strongly based on rental rates - and until vacancies hit a certain percentage they’re not counted much at all.
One popular way to “flip” an apartment building of 100 units or so is buy one that is 100% rented and slowly raise rents until it is 80-90% rented and then sell it n
By definition when you have constraints on the natural levers of supply and demand in the form of price controls, markets aren’t going to act rationally.
