An initiative that would give cities and counties the authority to employ rent control policies has found its way onto the November ballot. While some feel this will help ease California’s housing crisis, others say that it would only make matters worse.
The initiative, known as Prop 10, would repeal the Costa Hawkins Rental Housing Act which prevents cities from passing laws that suppress rents.
Proponents of the initiative, including the Coalition for Affordable Housing, the AIDS Health Care Foundation and Alliance of Californians for Community Empowerment argue that housing costs continue to skyrocket in California with median rents the highest in the country.
The government defines housing costs in excess of 30 percent of income as burdensome. However, more than half of California renters are spending 30 percent or more of their income on rent while a third of renters are spending more than half of their income, according to supporters of the initiative.
No on Prop 10, one of three political action groups opposing the initiative, argues that the initiative has no protections for renters, seniors, veterans or the disabled and doesn’t provide rent rollbacks or new affordable housing. According to No on Prop 10, increasing tax credits for renters, passing new bonds to provide public funding for affordable housing construction and requiring developers and cities to build more affordable housing across the state are better solutions for addressing the state’s housing crisis.
Locally, city leaders and real estate professionals weighed in on the topic, and while some felt the conversation was premature, others voiced that rent control is not the right approach for tackling the housing crisis and that it could even worsen the housing shortage.
Mayor Alan Nakanishi said he is against rent control and that if the initiative passed he would not be in support of approving a rent control ordinance in Lodi. If rent control were to be enforced, Nakanishi argues, there would be less homes available. He says that state regulations have made it more expensive to build homes in California and have also increased the cost of living. He feels the state legislature should do more to lower these costs rather than cities enforcing rent control.
Lodi City Council District 2 candidate Spencer Rhoads said he opposes rent control, and like Nakanishi feels the state needs to be focusing more on the California Environmental Quality Act and the regulations that hinder developers and stop houses from being built. The skyrocketing costs in rent and housing is a supply problem, Rhoads said.
“I think the whole topic of rent control is a little off. We need to be focusing on how we can increase supply, not how we can reduce the price of rent. So if it came to it, I would not produce a rent control ordinance in Lodi,” Rhoads said.
According to Lodi City Planner Craig Hoffman, in the past year several apartment complexes have been constructed in Lodi, the first new units the city has seen since 1986. Developments include Rubicon with 156 units, Eden Senior Housing with 80 units and Revel senior apartments which will have 142 units once completed. He anticipates more development in the future and feels that Lodi currently has an adequate amount of rental housing but is unsure if it will meet the needs of the county or the state.
Rudy Willey, a real estate adjunct professor at San Joaquin Delta College who has a 30-year career in the real estate industry, said that while he understands the general population’s difficulty finding adequate rental housing, most professionals in the industry believe that rent control can have a negative effect on the rental market. Willey says that rent control doesn’t give landlords the incentive to make repairs or upgrades because they know that they won’t get it back in the rent that they can charge, leading them to defer the maintenance or sell the property.
The high rent prices in California are not because of the landlords but a result of local governments that don’t allow enough affordable housing to be built and the high building fees that are charged locally, Willey said.
“I think that there is a solution to the housing problem, but the emphasis has to be on the production side,” he said.
Melanie Pennino, a Realtor at PMZ Real Estate and a member of the California Association of Realtors, also believes the housing crisis is a supply issue. Pennino argues that Prop 10 would discourage new construction and reduce the availability of affordable housing for low-income and middles-class renters. It would also increase the cost of existing housing, she says, and homeowners may choose not to use their houses as traditional rentals but as vacation rentals to generate more revenue.
Lodi Councilwoman JoAnne Mounce likes that the initiative would give cities more local control.
“If a local community wants to have this tool, I think they should be able to have this tool,” Mounce said.
If Prop 10 were to pass, Mounce said she would be willing to have the conversation about the possibility of having rent control at Casa De Lodi, a senior living trailer park.
“I’ve had many requests from Casa De Lodi residents requesting that there be rent control placed on them, and of course, we can’t do that, but they would certainly like that,” Mounce said. “I’d imagine there would be pressure on the city council to at least have a conversation. I just don’t think that my current council would have any desire to move forward with rent control.”
Mounce added that she is not a fan of forcing property owners into offering affordable rent prices.
Lodi City Manager Steve Schwabauer was neutral on the topic and said it was too early to say what the city would do if Prop 10 passed. He says that before the city could have that discussion, staff would have to evaluate the housing prices in Lodi, and that hasn’t been done yet.
“It’s something that’s got to be studied on an individual community basis to determine if it’s necessary and if it can help, and right now, we can’t pass a rent control ordinance. There are some very limited circumstances in which you can, but they’re extremely limited. We’ll evaluate the question of whether or not it can help if and when Proposition 10 passes, and it’s possible for cities to do.”