Final answer:
Investing in a two-to-four unit dwelling can be disadvantageous due to price ceilings which limit rental income, causing landlords to reduce maintenance and essentials, leading to lower housing quality.
Step-by-step explanation:
A disadvantage to investing in a two-to-four unit dwelling relates to the economics of rent control and the quality of housing provided. When price ceilings are imposed, they are intended to keep rental costs down, but there can be unintended consequences. Landlords may be less inclined to maintain their properties or invest in essentials like heating, cooling, hot water, and lighting. This is due to the economic principle that everything has an opportunity cost. If rental income is artificially limited by a price ceiling, landlords might not earn enough to cover these costs and still make a profit, leading to lower quality housing for tenants.
Moreover, landlords might choose to convert their rental properties into co-ops or condos, which decreases the availability of rentals. This can leave some tenants without housing or force them into more expensive market-rate units. Therefore, a two-to-four unit dwelling under rent control may end up being a less attractive investment due to these economic factors.