Government - California Approves Rent Control
Californians are getting some help the Golden State's legendary housing problems from the state legislature's approval of rent control legislation. Governor Gavin Newsom, often touted as a future US presidential contender, says he will sign the bill.
The bill limits rent increases to five percent per year, even tighter than the seven percent law passed in Oregon earlier this year. Tenants' Rights groups pushed for the legislation on behalf of eight million residents of rental apartments and homes.
"The housing crisis is reaching every corner of America, where you're seeing high home prices, high rents, evictions and homelessness that we're all struggling to grapple with," said the bill's author, state lawmaker David Chiu, a Democrat from San Francisco. "Protecting tenants is a critical and obvious component of any strategy to address this."
Conservative economists tend to oppose rent control because it makes no provision for cost-of-living increases that impact landlords. The argument goes, if landlords can't increase rates to deal with their finances, they abandon the business by converting units into occupant-owned housing, squeezing renters again by reducing the number of rental units in a given area.
But the housing situation is out of control in the state's great cities and surrounding communities. Cities like San Francisco, Oakland, and Los Angeles already have rent control laws, but the surrounding suburbs did not until this. The average monthly rent for an apartment in San Francisco is AU$5,375.00, and the homeless population has increased 17 percent since 2017. Escaping that by moving to the suburbs has not guarantee of success.
Preschool teacher Sandra Zamora lives in Menlo Park, on the Peninsula between San Francisco and San Jose. She paid AU$1,600 per month for her apartment; but the owner sold to a new landlord who raised the rent to AU$2,760. She's attempting to stick it out by taking a second job as a barrista; most of her neighbors left. Under the new law, the rent hike would only have been AU$80.
"Any victory helps to build a groundswell," said Cea Weaver, campaign coordinator of Housing Justice for All. "There is a younger generation of people who see themselves as permanent renters, and they're demanding that our public policy catches up to that economic reality."