Landlords charge what the market will bear and economical for them to own the rental.
replyI don't think anyone I know will own a business that is not profitable.
It'll make it so new construction tends to be condos rather than apartments, since the first is heavily preferred by tax policy. This reduction in supply will mean higher rents.
replyNew construction is like 1-2% of total housing stock annually. It'll take a relatively long period of time for these sorts of changes to hit prices because again, low price elasticity of supply.
replyedit: on slightly further thought, you'd also need this effect to either increase overall vacancy or reduce total construction, since any supply shift from occupied rental units to owner-occupied condos also implies a demand shift from renting to owning.