California

Bernie-Backed Ballot Initiative Would Expand California's Brand New Rent Controls

The new initiative from the AIDS Healthcare Foundation would allow local governments to go beyond the state's existing caps on rent increases.

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Last year, California became the second state in the union to pass statewide rent control. But that wasn't enough for some activists, who've succeeded in putting a new, more expansive rent control initiative on the ballot this year.

The California Secretary of State's office announced on Monday that the Rent Affordability Act had earned enough signatures to qualify for the November 2020 ballot. The measure is being sponsored by Housing Is A Human Right, a project of the AIDS Healthcare Foundation (AHF).

"Housing affordability and homelessness are the most pressing social justice and public health emergencies in our time," AHF President Michael Weinstein said in a press release. "We'll face a tough road ahead but are ready for the fight—and victory!—for all Californians and for housing affordability."

This is round two for AHF, which was also the primary backer of the state's last rent control ballot initiative in 2018, Prop 10.

That measure went down in flames, receiving only 40 percent of the vote. In the wake of its failure, the legislature passed a rent control law that capped rent increases at 5 percent plus inflation for buildings older than 15 years.

What that bill did not do was repeal the Costa-Hawkins Act, a state law that forbids local governments from imposing rent control on buildings constructed after 1995 and guarantees landlords the right to raise rents as much as they want on vacant units.

That was a major disappointment for tenant activists who wanted lawmakers to go farther. Weinstein himself criticized the rent control bill that passed as too weak, telling the Los Angeles Times, "it won't stop the homeless crisis which is being caused by people losing their homes or being evicted…it won't advantage working people and people on fixed incomes who need affordable housing."

AHF's initiative would thus largely eliminate Costa-Hawkins, allowing local governments to impose rent caps that are lower than the state's existing ones. It would also limit the amount landlords could raise rents on vacant units to 15 percent over a three-year period.

In addition, the ballot initiative would expand rent control to single-family homes and condominiums that are owned by people with more than two housing units in their possession. Current law exempts single-family homes and condominiums, except for those owned by corporations or real estate investment trust funds.

The ballot initiative has been endorsed by Sen. Bernie Sanders (I–Vt.), who said it "will allow California cities to pass sensible limits on rent increases and protect families, seniors, and veterans from skyrocketing rents."

Neither landlords nor labor unions are happy about the ballot initiative, however.

Both the California Apartment Association (CAA), a landlord trade group, and the State Building and Construction Trades Council, which represents construction trade unions, have issued strong condemnations of the measure.

The initiative would "block the path towards future investment in the construction of affordable housing units for the working class," said Cesar Diaz of the Construction Trades Council.

Tom Bannon, who heads up the CAA, was even more blunt, saying in a press release that Weinstein is "abusing the statewide initiative process to impose extreme forms of rent control and satisfy his extreme form of NIMBYism."

This sets the stage for another contentious, expensive campaign. AHF spent $21 million supporting Prop 10 in 2018. Opponents spent $72 million to counter the measure.

Critics contend that rent control limits the construction of new units and encourages the owners of existing ones to convert them to pricier, but unregulated, condos.

That's less of a concern for Weinstein, AHF, and other left-wing activist groups, however. They see speculation, not supply constraints, as the cause of California's housing problems.

Indeed, in the same press release announcing that the Rent Affordability Act qualified for the ballot, Weinstein also dissed the recently failed SB 50—which would have legalized four-unit homes statewide and mid-rise apartments near transit—as "deeply flawed."

If recent history is any guide, this latest rent control ballot initiative will likely fail. Unfortunately, the fact that it exists at all speaks to the growing popularity of the worst idea in housing policy.

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36 responses to “Bernie-Backed Ballot Initiative Would Expand California's Brand New Rent Controls

  1. Rent control and anti gentrification as an actual political position are the 2 dumbest things from leftists, among the issues they care about that can actually have some economic impact.

    1. Because compared to them, nationalizing health care and industry is totes small potatoes

      1. Didn’t you hear — Housing and Healthcare are the CHEAPEST most accessible goods & services the U.S. has THANKS to the “lefts BIG plans”.. They’ve been so successful; they keep insisting we just can’t have enough of them. /s

  2. Bernie hates property rights. Well, except his .

    1. I have heard of proposals requiring people to rent out “spare” rooms. I wonder how many spare rooms Bernie has in his three houses.

      1. Throw them into a cage match with those outlawing renting rooms in your home, and nobody walks out alive.

    2. An environmentalist is someone who already has a redwood deck.

      Anyway, the nomenklatura have never felt bound by the policies meant for the proletariat. Bernie’s just upholding a hundred years of Commie tradition.

  3. “”They see speculation, not supply constraints, as the cause of California’s housing problems.””

    By speculation are they referring to the value of a home?

    1. The prevailing conspiracy theory around my parts is that housing prices are through the roof because Evil Corporations have bought up all the housing stock and are deliberately leaving it empty in order to jack up property values and/or tank them so they can gentrify.

    2. Nope. They are referring to those who invest hundreds of thousands of dollars (the minimum cost to build a simple duplex, for instance, even in fairly low-rent areas) and hope to (someday), actually turn a profit on it. Speculation? It’s called “investment.”

      What is ironic, of course, is that if I decided to tear down and rebuild one of the two single-family homes I rent out in CA, which is nearing the end of its useful life, and replace it with a modern, energy-efficient duplex, that it would then come under rent control. So I guess that ain’t a gonna happen.

  4. The new initiative from the AIDS Healthcare Foundation

    Rent control. Rent… control. Mission creep much?

    1. Probably a descendant of Act Up, agitators who claimed to be about AIDS patients but were more interested in communism.

      1. See my post below… yeah, Weinstein (no, not that one, the other one). Infamous. Not well liked. Not even in the AIDS activist community not well liked. That’s how much not well liked.

    2. It’s Parkinson’s coefficient of inefficiency – as a bureaucracy grows, it begins to dedicate more time to ancillary and trivial issues and less to core functions until a critical mass is reached whereupon it is doing nothing at all toward its actual purpose. At this point, an additional bureaucracy is formed to take on the mission abandoned by the first bureaucracy while the first bureaucracy simply restates its functional purpose. It’s a real thing.

    3. Didn’t you see RENT?

  5. Well, California richly deserves Bernie. A match made in – – –

    1. West Covina?

  6. AHF President Michael Weinstein

    Oh wait, this fuckin’ guy?

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  8. The SF Chron ran an article several weeks back in the Sunday edition, largely given over to ‘think’ pieces since it’s put to bed several days in advance.
    No, I didn’t read it, but have no reason to think is was intended ironically. The head line claimed that house-flipping added to the housing “crises”.
    (scare quotes, because there is no “crises”)

    1. Well of course! You’d be looking for a new domicile too if someone had turned your old one upside down!

    2. Flipping does drive up prices for ownership by creating extra (and possibly artificial) demand in the market; especially in L.A. where they’re generally associated with someone with a RE license and have access to buy up forclosures and other inventory before it’s made available to the general market. It took me forever to find a “fixer” house in my area, but I did walk through at least 5 places with the same bottom-of-the-line flooring and appliances installed that were being sold as “newly renovated” and tacking on Thermador-level prices for the cheapest Frigidaire junk that any local store had in stock; I had no real interest in paying a premium for cosmetic dress-up “fixes” that I knew I’d be needing to re-do within 2 years if I bought the place.

      1. No worries, there are plenty of low-info buyers with subprime mortgages who will snap it up for the asking or even bid it up. What could go wrong?

  9. Rent control – probably one of the worst ideas to reduce homelessness. All it will do is reduce the construction of new residences while causing max increase in value and cost of existing residences. If you want to increase available and at the same time reduce cost one must, and I can’t emphasize that enough, must, reduce regulations, make land available and allow builders to build, to over build. That will reduce price because swamping the market with a product does that, and at the same time coincidentally increase availability.
    Will that happen? Not in California where those who own homes, which is a significant part of the voting population, and rental property want to preserve their value. Cheers!

  10. Didn’t he all recently float the idea of nationalizing electricity production? Right after freaking Venezuela announced it would try to prioritize what is left of it’s oil industry? Incredible…

    And the scary thing is that the stands a real chance of being the nominee. But at least his views are consistent!

  11. I have a wealthy friend in NY who considers himself progressive. He bought a duplex and converted it to a single family home for himself.

    1. Yes, but surely he confesses his privilege regularly which makes it OK. Religion is a tough thing to adhere to consistently, especially one as miserable and contradictory as leftism.

  12. California has a shortage of housing and they want to make that shortage worse.
    Why does not California build homes and rent them to the people and families that need the? They could tax the rich to finance the building and to pay part of the rent so people could afford them. Since they would not need to property taxes nor insurance I would think that they could build and rent these houses much below market price.

  13. How hard can it be for people to grasp this realtionship?

    Shortages create high prices, price controls create shortages, and rent control is price control.

    But then, Bernie seems to think that he can eliminate all of the profits from the pharmaceutical business without eliminating pharma busniess in the process. At least his claim to eliminate the profits from health insurance is consistent with his declared intention to eliminate private health insurance altogether.

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  17. Homelessness is not a national problem. It is not a problem in conservative communities and states. CA, NY, IL, WA, these are the centers of homelessness. They are also centers of leftism, and of policies which attract the homeless. Just make pooping on the sidewalk a felony, punishable by being assigned street-cleaning duty.

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  19. Remember, Bernie spent his honeymoon in Moscow. Stalin confiscated the homes and land of the elite the Bourgeois and the farmers. The result of which was mass starvation, death, and imprisonment. Not saying Bernie will take us there, it will just be another leap in that direction.

  20. That measure went down on fire, accepting just 40 percent of the vote. In the wake of its disappointment, the lawmaking body passed a lease control law that topped lease increments at 5 percent in addition to expansion for structures more seasoned than 15 years.

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