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Is Palo Alto ready for rent stabilization? City explores new policies to help tenants

Original post made on Apr 15, 2021

Seeking to address the plight of low-income residents in a city famous for its astronomical rents, Palo Alto is considering a wide range of new programs designed to protect and assist tenants facing displacement.

Read the full story here Web Link posted Thursday, April 15, 2021, 11:11 AM

Comments (17)

Posted by Online Name
a resident of Embarcadero Oaks/Leland
on Apr 15, 2021 at 7:54 pm

Online Name is a registered user.

Good this squeaked through.

"The new push to strengthen tenant protection is, in some ways, a revival of a debate that has proceeded in fits and starts since 2017, when three members of the council — Tom DuBois, Lydia Kou and former council member Karen Holman first proposed in a memo that the city consider rent stabilization and other measures to help renters, who make up 45% of the city's households. .... The most vocal opponents of the proposal were former council members Greg Scharff and Adrian Fine, who argued at one hearing that instituting rent stabilization would "reduce housing availability and decrease housing quality."

And shame on pro-development boosters like Mr. Scharff, Adrian Fine and the 3 members of the PTC who opposed this measure and preferred relocation allowances!! so unaffordable development could continue apace!

Posted by Easy8
a resident of Green Acres
on Apr 15, 2021 at 9:04 pm

Easy8 is a registered user.

My grandmother owned a 4 unit complex in Oakland, where she lived in one unit and rented the other 3 out. One of the tenants was very problematic - very loud, and often inviting friends over for lots of alcohol, parties, and probable drug use.

But because of Oakland's rent control and tenant protection laws, there was absolutely nothing my grandmother could do, and it caused her enormous stress and unhappiness for over 5 years before the tenant finally moved out on his own. As all the other tenants eventually left, my grandmother never replaced them with new tenants because of that experience. In the end, she was content with 3 vacant apartments, thus removing 3 badly needed units from the housing stock.

Paul Krugman, a Nobel Prize Economist who is an ardent Democrat and writes for the NY Times,
had this to say

"The analysis of rent control is among the best-understood issues in all of economics, and -- among economists, anyway -- one of the least controversial. In 1992 a poll of the American Economic Association found 93 percent of its members agreeing that ''a ceiling on rents reduces the QUALITY and QUANTITY of housing.''

"Almost every freshman-level textbook contains a case study on rent control, using its known adverse side effects to illustrate the principles of supply and demand.

"Sky-high rents on uncontrolled apartments, because desperate renters have nowhere to go -- and the absence of new apartment construction, despite those high rents, because landlords fear that controls will be extended."

"Bitter relations between tenants and landlords, with an arms race between ever-more ingenious strategies to force tenants out and constantly proliferating regulations designed to block those strategies"

(end quotes from Paul Krugman)

Web Link

Posted by Free truth
a resident of College Terrace
on Apr 16, 2021 at 6:52 am

Free truth is a registered user.

I lived for a while in Berkeley where there is active rent stabilization. It basically allows slumlords to thrive since they don’t care if the apartments are well maintained and look only at the bottom line. There are only two rational alternatives for high rents: allow construction of many more high rise units or accept that people are going to move to neighboring cities. Paradoxically, Austin that has no rent controls has far cheaper rents and better quality apartments than Berkeley, Oakland etc.

Posted by Novelera
a resident of Midtown
on Apr 16, 2021 at 11:26 am

Novelera is a registered user.

This is very good news. Alcheck just doesn't disappoint, does he? He was in favor of bending the law for his own benefit regarding the garages at his spec houses, but hates any idea of help for Palo Alto renters.

Posted by John
a resident of Adobe-Meadow
on Apr 16, 2021 at 12:48 pm

John is a registered user.

I challenge anyone who is for rent control to explain to me what happens on a supply and demand graph once you cap your price variable. Fun fact: you can do the same thing in the opposite direction on minimum wage.

Price controls don’t work. Planned economies don’t work. This is basic stuff.

Posted by Me 2
a resident of Old Palo Alto
on Apr 16, 2021 at 1:58 pm

Me 2 is a registered user.

Might want to learn from the Germans.

Web Link

Rent control is good for those folks who were lucky to be renting when enacted. Not so good for everyone else. If you really cared about the plight of renters, you wouldn't be fixated on making it so complicated to build housing.

You can't be a residentialist and care about renters. You're being hypocritical.

Posted by Barry Scott
a resident of another community
on Apr 16, 2021 at 3:04 pm

Barry Scott is a registered user.

Rents in Palo Alto should be fixed. Some recommendations...

(1) Up to $2K for a studio, (2) Up to $3K for a 2BR/1B apartment, and (3) Up to $4.5K for a house rental (depending on the neighborhood and bedroom + bathroom configurations).

Anything more is a blatant rip-off and the landlords should be prevented from charging exorbitant rents.

Greed is ugly.

Posted by Annette
a resident of College Terrace
on Apr 16, 2021 at 6:00 pm

Annette is a registered user.

I recall the CC meeting that became all about rent control even though the colleagues memo was for Staff to look at protections. Just to study to see what options existed. What a chaotic meeting. Ardent opponents of rent control reframed the agenda item and chambers filled with speakers. Some were from San Francisco and if memory serves, one woman drove from Davis or some similarly distant place for her chance to speak.

Since there are valid concerns about the unintended consequences of rent control, let's hear from Alcheck et al (including former mayors Kniss, Scharff, and Fine) about the elephant in the room that they all ignored for years: incessant job creation that drives housing demand that deepens the hole we have been digging deliberately and enthusiastically for at least a decade now. If the real life consequences of the development binge promoted by those who constantly pushed approval of commercial development weren't as devastating as they are for the housing insecure and the homeless, the policies that got us into this mess would be laughable.

Is there a way to claw back some of the latitude that commercial developers were granted and get them to mitigate the commercial growth with some housing?

Posted by Biff Langendorf
a resident of another community
on Apr 16, 2021 at 6:06 pm

Biff Langendorf is a registered user.

Landlords have a right to seek a reasonable ROI.

If a tenant cannot handle the rent, move on.

Posted by Native to the BAY
a resident of Old Palo Alto
on Apr 16, 2021 at 8:52 pm

Native to the BAY is a registered user.

Here are some other ideas: subsidize outlandish HOA fees, abolish requiring a prospective tenant to have three months of pay stubs upfront, proof of monthly income 3 times the amount of monthly rent and proof of enough cash in the bank to cover three months of rent. Though renter rights say it’s against fair housing law to deny Federally backed S8 vouchers PA property owners/landlords jack up the rent to far above AMI, which reduces acceptance of the voucher to zilch — unless one can get in at Alta (10 year minimum wait) , or Mid-Pen housing. What’s the problem ? Prejudice, stigma, greed prohibits equitable fair housing rents and therefore choice. Families — yes poor ones — still need a yard to practice ballet or ball (just as much as everyone else who have money has), a place to practice an instrument, paint a painting enough storage for clean towels, vacuums, linens, jackets, small/repair utility tools, camping equipment, holiday decor, safe covered bile lock up, EV charging stations and maybe to store a few cherished pictures and letters from grandparents and other relatives. It’s absurd that poor people get squished into small ECR corridors, have no parking, no outdoor space, bike lock up or enough square footage to grow and thrive like single family home owners ... Invest in our residents and we’ll invest in our community like the PTA, volunteer for Little League or the classroom and more .

Posted by Me 2
a resident of Old Palo Alto
on Apr 17, 2021 at 2:15 pm

Me 2 is a registered user.

"incessant job creation that drives housing demand that deepens the hole we have been digging deliberately and enthusiastically for at least a decade now"

What is the Palo Alto CC and Planning Commission going to do about the job creation outside of Palo Alto? Any "jobs created" in Palo Alto were dwarfed by job creation in other parts of the Bay Area. BTW, Google is in MV, Facebook in MP and Apple in Cupertino.

What is this magical bubble that people think we have that development in Palo Alto is somehow causing this housing crisis within Palo Alto? Have you guys heard of, um, cars? Caltrain?

Such a provincial view on things.

Posted by Online Name
a resident of Embarcadero Oaks/Leland
on Apr 17, 2021 at 3:12 pm

Online Name is a registered user.

What is the Palo Alto CC going to do? They can stop requiring office space in new 'mixed use" developments where the square footage for offices always manages to be more than that for housing. They can finally honor the office caps that the voters demanded when we signed the ballot initiative years ago.

Also, Google is not just in Mountain View; they're expanding in Palo Alto and elsewhere! Read up on how their development in San Jose with 20,000 jobs to each housing unit with very few of those BMR is displacing entire neighborhoods, local businesses and possibly forcing out major athletic teams like the Sharks because they've taken away their parking!

Posted by Annette
a resident of College Terrace
on Apr 17, 2021 at 8:09 pm

Annette is a registered user.

@MeToo - thank you for pointing out that the issue is not exclusive to Palo Alto. It's easy to focus mainly on one's own city, where one lives and votes. Unfortunately, the problem is of such a magnitude that thinking "provincially" might at least help move us in the right direction here. For solutions beyond here, one thing we can do is be careful about who we send to Sacramento. Despite the rhetoric, the pending housing legislation that Weiner et al are pushing will actually make things worse; it is deceptive. And heartbreaking.

Posted by Gertrude Reagan
a resident of Midtown
on Apr 18, 2021 at 4:47 pm

Gertrude Reagan is a registered user.

How can you help the unhoused if there is no place without a short wait list to go to?
RVs seem like a good solution to them. Yet we yell about them.

I've been hearing about the jobs/housing imbalance sice Robert Debs was on the council in 1968. (We moved here in 1963.)

My caregiver/assistant is a formerly unhoused person. She's terrific! I don't have a spare bedroom, but she is willing to sleep in my garage.

We need more sharing! I'm in favor of more of us building tiny homes and granny units if we have the space.

Construction costs, they say, mean only luxury apartments can be built. How can we encourage and even subsidize community service agencies to acquire land and build?

Posted by Nayeli
a resident of Midtown
on Apr 19, 2021 at 8:13 am

Nayeli is a registered user.

If memory serves, the rent for many Alta (Palo Alto Housing Corporation) residents went UP recently while the rent around the area went down due to COVID-19 vacancies.

Q: Why?
A: Because they could.

The law currently allows rent to go up for existing tenants a certain amount per year. COVID vacancies around the Bay Area saw rents drop because of excessive vacancies. The same was not true for the "affordable housing" in Palo Alto. The owners or operators took advantage of laws that permit increases contrary to market rate trends. Even a 5-10% increase is significant -- especially when the per capita income in the Bay Area dropped significantly.

At the same time, the owners of properties do have a legal right to do this. It's a housing market that really doesn't need more regulation UNLESS you're referring to participatory "affordable housing" programs for which the property owners benefit.

One of the flaws of the state-level COVID reaction bills was the inability to consider this. I am opposed to "rent moratoriums" that target and hurt landlords. At the same time, there were legislative steps that could have been taken in "affordable housing" programs to help both the renter and the landlord -- while restricting the ability of the "affordable housing" landlords to raise rent during the pandemic.

Instead of giving stimulus or aid money directly to needy residents, it could have come in the form of rent assistance programs during the 13+ months (and counting) of pandemic.

Posted by William Hitchens
a resident of Mountain View
on Apr 19, 2021 at 4:35 pm

William Hitchens is a registered user.

Isn't "rent stabilization" just another attempt to rename and repeat a horribly failed political policy called "rent control"? To paraphrase Shakespeare, "A disaster by any other name is still a disaster". As for the word "Progressive", after FDR (I think) "Progressive" was changed to "Liberal" to shed the negative public opinion of "Progressives". And now after the failure of "Liberal" policies, particularly those of Lyndon Johnson, Carter and Obama, the alt-Left has gone back to calling themselves "Progressives". This is true irony, because it is just history repeating its previous disasters.

To paraphrase Burke (you know Burke, right?): Those who don't study history are doomed to repeat [its mistakes]. Take off your blinders.

Lest anyone think I'm some kind of subhuman tRUMPite, I am NOT. I'm a very highly educated Moderate Independent who thinks that both political extremes in the USA are highly destructive to the USA, to its economy, to its Rule of Law, and ultimately to All Of Us. I think we need to revise a political nomination process to achieve Cenerist governments of true compromise, and not just a bunch of ignorant, idealistic, angry slash-and-burn morons dominating both the Republican and Democratic "parties".

Posted by Optimist Pessimist Realist
a resident of East Palo Alto
on Apr 20, 2021 at 10:32 am

Optimist Pessimist Realist is a registered user.

The snobbery and ignorance in these comments about rent stabilization in California is unsurprising. The more things change, the more Palo Alto remains the same.

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