California Assembly passes rent-cap bill

[TexasTowelie]

SACRAMENTO — In a dramatic victory for tenant advocates, the California Assembly narrowly passed a statewide rent-cap proposal on Wednesday night amid mounting pressure for lawmakers to protect renters from the steepest of increases in a hot rental market.

If the bill clears the Senate, California could become the second state in the nation this year to limit annual rent hikes, covering millions of properties not covered by local rent control rules.

In a final appeal to his colleagues, the bill’s author, Assemblyman David Chiu, said the bill would protect the most vulnerable residents who are a rent-hike away from eviction. “They are our neighbors,” he said. “They are our co-workers. They are our brothers and sisters. They are our grandparents.”

Assembly Bill 1482, which passed 43-28, would apply to most properties not covered by local rent control ordinances — including rented single-family homes and condos in cities with rent control. It was amended last week to exempt properties that are less than 10 years old, and — because of an 11th-hour handshake deal with a powerful trade group — it will undergo more key changes in the Senate.

Read more: https://www.mercurynews.com/2019/05/29/california-rent-cap-bill/

[PBC_Democrat]

1. I find it insane that anyone thinks this is a good idea ...

Last edited Thu May 30, 2019, 11:16 PM - Edit history (1)

Please read, or at least scan, the the report at this link.
https://www.nmhc.org/news/articles/the-high-cost-of-rent-control/

"In a final appeal to his colleagues, the bill’s author, Assemblyman David Chiu,
said the bill would protect the most vulnerable residents"

It will accomplish exactly the opposite - it may a small bit in the short run but has terrible long-term consequences.
In addition to reducing the supply of rental properties, it reduces the mobility of renters.

Anything that 93% of economists agree on really should be taken seriously.

[Merlot]

2. It should only apply to large appartment complexes

Not smaller rentals usually owned by a landlord instead of a corporation. The corporations can absorbe the lack of increase in rent, single property landlords will have a harder time.

[PBC_Democrat]

3. The large apartment complex owners are the ones with the capital

... and the option to build something OTHER than new living spaces.

As soon as you remove the profit motivation - they'll look at other options.

When a parking lot or a strip mall becomes a better option -- apartments drop off the list hurting the very people the law is intended to help.

[Merlot]

4. To be clear, I'm not for this rent control at all

but if they're going to pass it, there should be exception for 6 unit or less buildings.

[displacedtexan]

5. Your link is to an org by and for rental property "leaders"

NMHC is the place where the leaders of the apartment industry come together to guide their future success. With the industry’s most prominent and creative leaders at the helm, NMHC provides a forum for insight, advocacy and action that enable both members and the communities they build to thrive

From an article on that site about debunking the myth of rent control:

With so much contradicting evidence out there, it important for NMHC members to have accurate information and insight into the issue. At the 2019 NMHC Research Forum in Denver, NMHC Chief Economist and Senior Vice President of Research Mark Obrinsky moderated a panel featuring Jim Lapides, NMHC vice president of strategic communications, and Caitlin Walter, NMHC vice president of research, to talk about rent control and related issues affecting the industry.

The panelists began by acknowledging the fact that there is an affordability crisis when it comes to the cost of housing—this is not a new problem, but one that has become heightened in recent years. Lapides pointed out how affordability has dominated the news recently as well as the political agenda of mayors, governors and, for the first time, presidential candidates vying for the 2020 nomination.

In fact, Senators Bernie Sanders, Kamala Harris and Elizabeth Warren have all openly endorsed rent control as a solution to affordability—with Warren introducing federal legislation to expand rent control. Since 2017, 14 states have made significant attempts to expand rent control, with the potential to affect more than half of the existing multifamily rental housing stock in the country.

In addition to affordability, the issue of evictions is also driving skepticism on the private sector’s ability to bring about affordability by unfairly casting a negative light on landlords. For example, in the popular book, Evicted, author Matthew Desmond uses a case study of smaller landlords in Milwaukee to highlight examples of unfair evictions. This case study, along with his work on the Eviction Lab website, has started a national discussion on an eviction crisis. These types of narratives feed into the public’s already poor perception of apartment owners and managers