The California Democratic Party on Sunday voted overwhelmingly to endorse Proposition 10, the statewide Affordable Housing Act, which would repeal the anti-rent-control Costa-Hawkins Rental Housing Act and return power to regulate rents to local communities.
Signed into law in 1995, Costa-Hawkins prevents cities and counties from applying rent control to apartments built after 1995, or to single-family rental units and condos. Costa-Hawkins also allows landlords to raise the rent as much as they want when a unit becomes vacant.
The Yes on Prop. 10 effort eclipsed the 60-percent support threshold to secure the party endorsement for the Nov. 6 general election.
This endorsement dovetails with a February addition to the official state Democratic party platform that specifically calls for “allowing local communities to create strong tenant and affordability protections against displacement, speculation, rent increases, and evictions without interference from state law.”
“Securing the Democratic Party endorsement is huge,” said Joe Trippi of Trippi Norton Rossmeissl Campaigns, the lead strategist of the Yes on 10 campaign. “The party’s endorsement helps make clear that it stands with the millions of Californians struggling to pay the rent and supports returning the power to respond to the state’s housing affordability crisis back to the people and back to local communities.”
Prop. 10 also has its critics, one of their main assertions being that the spread of local rent control will have a chilling effect on construction of new apartments in California.
“From Lt. Gov. Gavin Newsom to labor unions such as the State Building and Trades Council of California to the NAACP, we are confident that most Democrats will oppose Michael Weinstein’s Prop 10 because it will worsen California’s affordable housing crisis,” Steven Maviglio, a political consultant for anti-Prop. 10 forces said Sunday, July 15.
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We own and manage 100 plus units. Instead of investing in other things like stock market dollar cost averaging, etc, we chose rental real-estate. We started with a duplex and worked our way up. Really difficult. Here is the rub and why even though it seems like rent control is protection–it doesn’t work that way.
Since we are now really to retire on our net income, many property owners like me will
1. our residential home owners in our neighborhood will begin to notice that we are not keeping our properties well painted, using great gardeners, our trees trimmed so nicely, our roofs roofed, our windows repaired with double pane, new flooring inside to attract a profile tenant os similar mind set to the local neighborhoods–like we do now–why? —–because our expenses must be paid by the tenants first. If we can’t raise the rents to pay for things like this we don’t do it. The money comes from the people who live there–or it doesn’t.
2. Investors who have been allocating their dollars to this product segment will no longer do so–to the level they do now with rents controlled by local economies. Financially the deals for future apartment building no longer pencil out–the supply chain dwindles down as the population increases.
This creates problems for everyone-different problems–the same people who think they are solving problems for others really are creating problems for the cities–remember how much blight was on Alma street in the 1980s and 1990s before rents started to increase and landlords could afford to paint and fix up their little trick-plexes and 4 plexus? It was ugly–an ugly depressive drive to Whole Foods. That’s just how the nuts and bolts of this control work.
@mari: you claim to own 100 units, and golly, you are against fair regulation at the community level?
There’s gambling in Casablanca? Wow. Let me guess – you’re also against closing Prop 13 loopholes that allow commercial property to change hands, and not be reassessed upon the sale?
This vote just allows communities greater flexibility to choose what is the right thing for THEIR COMMUNITIES. Sort of a state’s rights issue – power down to the community.
It’s the republican, conservative, small government thing to do.
Personally, I don’t want the STATE telling us what to do in our COMMUNITIES!
@libertarian
Support for rent control is almost always determined by whether you’re a renter or a property owner. You would agree with @mari if your paycheck depended on it.
Does Costa Hawkins under current law include Duplexes as being subject to rent control? Can only find reference to single family and condos.
“Costa-Hawkins prevents cities and counties from applying rent control to apartments built after 1995, or to single-family rental units and condos.”
@StewPid:
Are you saying that your principles of efficient, smaller government are overturned by the chance to increase profit?
“In general”, long-term rent control is a bad idea. Long-term, the result is blight. But, I have to admit that rent control sure is tempting in the midst of today’s short-term bubble. There may be a workable compromise that helps dampen short-term speculation while not killing incentives to develop new affordable housing.
“This vote just allows communities greater flexibility to choose what is the right thing for THEIR COMMUNITIES. Sort of a state’s rights issue – power down to the community.”
@libertarian – sometimes communities do stupid things. Sometimes communities run amok. You want power to the communities, why not just abolish the Bill of Rights, and let cities decide?
Repealing Costa Hawkins is a bad idea. It will limit supply. For example, an owner of a SFH who is temporarily relocated for two years can rent out her home for now. If Costa Hawkins is repealed, after two years, she will not be able to move back because the home is rent controlled. So she will let the house sit empty.
Repealing Costa Hawkins will discourage repair. Suppose a tenant moves out of a place. The landlord can renovate, knowing that a new tenant will pay market rent. If the landlord cannot get market rent, why repair?
Repealing Costa Hawkins will create inequality. Rent is not tied to income, but to how long a tenant lives there. Accordingly, a high-income person may hold on to an apartment for the low rent just for the convenience, even if he does not live there.
People with good intentions, like yourself, need to know that their actions may have unintended consequences. Shouting slogans like power to the community does not help.