LA County Extends Rent Control Measures
The Los Angeles County Board of Supervisors voted 4 to 1 on Tuesday to prolong a temporary six-month rent control ordinance for unincorporated areas until the end of the year. This means that in the affected areas, rent increases will be capped at 3% annually in apartment buildings built prior to 1995 and tenant evictions will be restricted. Tenants can’t be forced out of rent-controlled buildings unless they have not paid rent or have violated their lease terms. Landlords can also evict renters when they would like to move into the unit themselves or if they are taking it off the rental market.
The ordinance was approved in November, shortly after voters statewide rejected Proposition 10, a measure that would have set sweeping rent control laws throughout California. The November ordinance was intended to be an interim statute to limit rent hikes while the county evaluates more long term solutions. The initial ordinance was set to expire on June 18, 2019. The approval of the ordinance extension means that the measure will continue to take effect until December 31st, 2019. The ordinance only applies to LA county’s unincorporated neighborhoods which cover about 65% of LA County. Affected neighborhoods include East Los Angeles, Marina del Rey, Baldwin Hills, Sunland, Sylmar, and Tujunga.
Renters and housing affordability advocates have been supportive of the extension of the measure. Proponents credit the county’s housing problems to soaring rents. They argue that many people in the county are unable to access housing due to high prices. Supporters also claim that the high prices in some areas are a result of no limitations on rent hikes and no ordinances to stabilize rents. They argue that now county officials are granted more time to craft a more permanent and long term ordinance to provide a solution to the housing crisis.
Although the measure does receive backing by some groups, many others are critical and oppose rent control as a solution to any of the county’s housing problems. Landlords and real estate interests cite rent control as a short-range solution to a very complex problem. Rent control restrictions have the potential to intensify the housing crisis and negatively impact different communities. Imposing price control policies remove the incentive to build more housing and causes building owners to neglect to maintain their properties.
Rent control should not be utilized as an effective measure to drive down costs, rather the county should consider ways in which to increase the housing stock in order to create more supply, increase competition, and ultimately drive down costs.
Rent control is not a sound solution that benefits all groups of people. There will be many groups, most specifically building owners, that will be negatively affected. The county must introduce a different measure that does not negatively impact certain groups of people but positively affects the county as a whole. The county needs to focus not only on more affordable housing but on the development of new housing at all income levels.
Efforts to enact rent control measures have been echoing throughout the entire state. California legislators have been deliberating over prospective changes to the Costa-Hawkins Rental Housing Act.
Currently, the 1995 Costa-Hawkins Rental Housing Act constrains cities from applying rent control to single-family rental properties. Costa Hawkins also guarantees property owners the right to raise rents to market value once units become vacant.
Are you curious to see how this will affect your property? Don’t hesitate to reach out to one of our experts. Call 310-425-9838 today! We’re always available to answer any of your real estate questions!
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