The biggest city in the nation's smallest state has a major housing problem.

Suffocated by decades of underbuilding, Providence, R.I., has become a prime example of how housing problems stretch far beyond much bigger cities such as New York and San Francisco. By at least one measure, from Redfin, the city of 195,000 is among the nation's least affordable based on rental costs and renter income levels. It topped the list last year.

This housing crisis is fueling a mayoral-primary showdown between an incumbent Democrat facing off against a challenger from the Democratic Socialists of America.

State Rep. David Morales, a 27-year-old DSA member and part-time professional wrestler, has said he would impose rent control in his first 100 days. He is mounting a challenge to incumbent Democrat Brett Smiley. Elected in 2022, Smiley argued such plans could hurt housing production and vetoed a proposed 4% cap on annual rent hikes earlier this year.

The housing-focused race comes to a head with Wednesday's primary election. The winner will face Republican David Talan in November to decide who leads the reliably liberal stronghold.

Morales has criticized Smiley, who is married to one of the state's top real-estate agents, for owning multiple homes. Smiley has characterized Morales as riding a national wave of democratic socialism that the incumbent says is inattentive to local needs.

The race has divided the city despite broad agreement-from the brightly colored colonials around Brown University to the apartments filled with Latino renters on the South Side-that housing costs have become untenable. The disagreement is over what to do about it and which leader will bring relief.

"Everybody's leaving" because of high costs, said Abby Theus, a 63-year-old nursing assistant and Morales supporter, adding that she is considering leaving Providence in the next couple of years. "If we don't do something, we're out of here. We can forget it."

Theus has been trying for years to leave her current rent-restricted apartment, which she said has pest infestations, but can't afford market rents. "Even though the housing you live in may be substandard, you have no choice but to stay," she said.

Adam Braff, who moved to Providence in 2021 from New York City seeking more space, worries that rent control wouldn't only depress development but also encourage owners to take their properties out of the rental market. He supports Smiley.

Providence, New England's third-largest city, features a dense cityscape filled with triple-decker apartments, a three-floor New England staple built to house legions of factory workers.

The metro area's average rental price has risen 34% to $2,089 since 2020, according to CoStar. Earlier this year, Zillow ranked Providence as the hottest rental market in the country and the fourth-hottest for-sale market, based on indicators including how fast listings go and the portion of sellers and landlords offering concessions.

A regional economic hub known for its local arts scene, the city has become attractive partially as a more affordable alternative to New York and Boston, said Brenda Clement, director of HousingWorks RI, a housing research group at Roger Williams University. Newcomers helped the population rise modestly since the Covid-19 pandemic began.

But Providence-like all of Rhode Island-is still trying to dig out from a long home-building dry spell, even after some recent growth in permitting and construction. For years, Rhode Island ranked near the bottom among U.S. states in new residential construction per capita, and from 2009 to 2015, developers there received permits for fewer than 1,000 units a year.

The problem, according to Clement: Restrictive zoning laws have made building density difficult, and Rhode Island has consistently invested less public funds in housing than its New England neighbors. This is a recipe for rental strain in a city where the median household income is $68,000 and that has grappled with significant homelessness.

"Renters are really strapped," said Hilary Silver, professor emerita of urban studies and sociology at Brown. "People are really spending 50% of their incomes on rent."

Morales, who rents in Providence, said the city can enact rent control without hurting production. The ordinance Smiley vetoed, for example, included an up-to-20-year exemption for new construction, which Morales said should ease development concerns.

He also argued that new construction isn't yet helping lower-income renters who need relief now.

"A lot of the new development that has come into Providence...has been at market rate or above market rate housing, and many of those rates are not actually meeting the needs of many of our neighbors," he said.

Smiley described his housing philosophy as "unapologetically pro-growth."

He has eased zoning restrictions to allow for denser development, sped up permitting and committed public money to developers. Providence has made a dent in its problem, adding more than 2,000 new housing units since Smiley took office, while permitting 726 in its most recent fiscal year.

"I do worry that misguided policies like [rent control] will stall out that progress before we really get to the point that it's caught up with demand," Smiley said.

Soaring housing costs have sparked rent-control pushes in some Democratic-controlled cities, with mixed results. In Portland, Maine, housing construction continued to accelerate after the city passed rent control in 2020, but it has slowed in recent years. In St. Paul, Minn., new construction permits plummeted after the city capped rent hikes, even as they surged in neighboring Minneapolis.

"I will not invest another dollar in Providence if Rep. Morales wins the election," said David Baskin, a Providence landlord and developer for 35 years. "If you want to cap rent, then cap costs," he said.

Republican candidate Talan opposes rent control, too, saying he instead wants the city's colleges to build more dorms so that students aren't using as many local apartments. "There's not enough housing to meet the demand, and anything that doesn't address that really isn't addressing the problem at all," he said.