"A study by David Autor, Christopher Palmer, and Parag Pathak measures the spillover effects of the 1995 end of rent regulation in Cambridge Massachusetts to reveal an increase in value of uncontrolled Cambridge housing by 2003 due to decontrol.
"Spillovers in the housing market, such as external effects related to the characteristics of nearby housing or attributes of nearby neighbors, serve as a key building block of urban economics. How did the sudden end of rent control in Cambridge Massachusetts in 1995 impact landlord investment incentives and the assignment of households to locations? Using data on the prices and characteristic of all residential transactions together with exact information on the location of each controlled unit, the study underscores large price effects on uncontrolled properties from the elimination of rent control. The estimates detail neighborhood trends, exposures to rent controlled properties, and controls for geographic locations. Building permit and expenditure data indicate some evidence of investment spillovers for houses in rent control intensive neighborhoods. The elimination of rent control has both a significant direct effect on the prices of controlled properties and an effect on the overall value of uncontrolled Cambridge housing stock due to spillovers."