With the 2018 midterm elections right around the corner, debates about Proposition 10 have started to gain more and more heat. Proposition 10 is a proposed solution to the housing crisis in Calif. which will impose rent control to to make properties more affordable for tenants. Proponents argue that the legislation will regulate rent prices and reduce homelessness. However, others contend that the bill will lead to hefty losses for landlords and jeopardize the house-renting market.
Before 1995, most cities in Calif. had rent controls in place to protect renters from market fluctuations. However, in 1995, legislators in Sacramento made a surprising move to pass the Costa-Hawkins Act, which eliminated rent controls on single-family homes and apartments built after 1995. The Mercury News found that a group of real estate firms created a monopoly of rent prices, as a result of the move. Drastic increases in rent prices caused many people to lose their homes due to a lack of affordability. Furthermore Paola Martinez, a writer of The San Diego Union-Tribune reported that the percentage of low income rent-stabilized apartments in Santa Monica had dropped from 82 percent to 14 percent a decade after the Costa-Hawkins Act.
More than ever, Calif. is in dire need of a solution to its housing crisis. Over a quarter of the entire nation’s homeless population lives in Calif.. The Los Angeles Times featured Laher Pour, “an 85-year-old who lives on a fixed monthly budget of only $927…[she] cried ‘uncontrollably’ and worried she would become homeless” after “her rent jumped 42 percent, from $592 to $838.”As the economy continues to boom, housing prices are becoming increasingly unaffordable for both workers and members of the older-generation. The Los Angeles Times featured Laher Pour, “an 85-year-old who lives on a fixed monthly budget of only $927…[she] cried ‘uncontrollably’ and worried she would become homeless” after “her rent jumped 42 percent, from $592 to $838.”
“Especially in this area, affordable housing is an pressing concern and I can see why rent control would be a viable and rational solution. However, buying property is extremely expensive, and I believe that landowners need to charge high rent prices to offset those costs,” Senior Allison Li said.
Indeed, others believe that Proposition 10 could lead to a decrease in construction of rental housing units and dissuade homeowners from investing in rental properties. Proposition 10 would diminish their profits and create less of an incentive to rent out their homes. When landlords are not able to make a profit from their renting properties, many will cut their losses by selling them. Thus, the amount of available housing for rent could go down and further aggravate Calif.’s housing crisis. However, The San Diego Union-Tribune reported that construction in rent-controlled cities was the same or greater than construction in cities without rent control. Regardless of rent control or not, there will continue to be high demand for affordable housing because so many people are in need of a place to live.
If Calif. wants to position itself for long term prosperity, then it ought to pass Proposition 10. In areas like Silicon Valley, affordable housing will continue to attract talent and create an influx of workers, fostering an accessible and affordable future for Californians.