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By Sammie Ann Wicks
November 1, 2024 (San Diego) --The voting public on Tuesday will again weigh in on the housing crisis, as homeless advocates and the real estate industry go head-to- head over a new rent control proposal, Proposition 33. If passed, the measure could change the current housing scenario in California drastically. While the measure does not mandate rent control, it would enable local cities or counties to enact restrictions on rental rates.
Who supports and opposes the measure?
One proponent of the Proposition33 has come out swinging in a recent opinion post.
"We are in the midst of a dire humanitarian and public health crisis, and corporate landlords and real estate tycoons are spending their time and money demonizing rent control," declared housing advocate Patrick Range McDonald in a recent piece on yeson33.org, a community consortium championing Prop 33.
A journalist and advocacy member of the Housing Is A Human Right organization, McDonald also serves in the housing advocacy division of the AIDS Healthcare Foundation.
Real estate industry leaders themselves, however, just as passionately assert that rent control will only make California's housing problems worse and diminish property owners' rights.
A recent ad and fact sheet paid for by The California Association of Realtors recently declared Proposition 33 would give local "politicians ... free rein in imposing and expanding extreme forms of rent control ... thereby raising housing costs." Other supporters of the ad include Homeowners for Families and the National Association of Realtors.
Many builders' associations and smaller landlords also have claimed the imposition of rent control on their industry would diminish their investments' earnings to the extent that many would abandon their projects and move out of state to do business in more supportive regions.
A number of California mayors also recently have gone on record opposing the proposition, saying it would ironically decrease the number of housing units in their cities: a Times of San Diego article on August 8, 2024 reported that Mayors Matt Mahan (San Jose), Todd Gloria (San Diego), Keith Blackburn (Carlsbad), John McCann (Chula Vista), Rebecca Jones (San Marcos), and John Franklin (Vista), indicated they do not support the measure.
A plethora of other publications and public statements by both supporters and opponents of Prop 33 now seem to have settled into two basic cadres: one aligned with real estate ownership interests, and another involved in advocacy for tenants. Both groups have put forth detailed arguments surrounding the measure.
What would Proposition 33 change?
Let's step back a moment and look at the recent legislative history of rent control, then clarify what the actual language of the current proposition is, and examine what effect its supporters and opponents think its passage would have on rent control in the state, and in California cities.
In previous measures to constrain ever-rising rent prices, in 2019 California Gov. Gavin Newsom signed Assembly Bill 1482.the California Tenant Protection Act, into law. It Iimits statewide rent increases to 5 percent annually, plus an amount for inflation--up to 10 percent total. But the current proposal goes much further.
Proposition 33, dubbed the "Justice for Renters Act," would revoke a previous law--the Costa-Hawkins Rental Housing Act--enacted in 1995 and sponsored by Democratic Senator Jim Costa and Republican Assemblyman Phil Hawkins.
The Costa-Hawkins Act itself does two things: it exempts properties built after February 1, 1995 from rent control; and it allows property owners to raise rental rates when a new tenant moves into a dwelling. The passage of Proposition 33 would allow rent control measures to apply to all housing, including the two above.
Proponents of rent control in California previously have tried to repeal Costa-Hawkins with ballot measures on two occasions--2018 and 2020--but both failed to pass.
If it goes through, Proposition 33 also would allow California cities to impose rent controls themselves, according to their own municipalities' needs.
Proposition 33 does not repeal AB 1482, but augments it, declaring, "The state may not limit the right of any city, county, or city and county to maintain, enact, or expand residential rent control."
How severe is the rental housing crisis?
Overarching opinions on Proposition 33, both for and against, are numerous and run the gamut. But a few basic views have surfaced as the measure continues to be argued.
First, say affordable housing and homeless advocates, most experts assert the cost of housing in California has grown so high for everyone that the situation can reasonably called a crisis.
A recent State of California Voter Guide in fact reports that "55 percent of Californians are rent burdened, paying more than 30 percent of their income on rent." The higher housing costs are, say rent control proponents, the less disposable income citizens spend on other purchases, harming the economy and stunting its growth.
Included among California's 17 million renters burdened by high rents are many public service professionals. The statewide guide says, "A starting teacher, cop, or fire fighter is paying half their salary to afford the average apartment in California's cities."
Other special demographic groups are doubly affected, say the authors of the Guide, noting that "many who live on a fixed income are one rent increase away from homelessness--and seniors represent the fastest growing homeless population."
Of the nation's ten highest-priced rental housing markets in 2024, four are in California; San Diego ranks eighth, according to Visual Capitalist.
But other constituencies argue that the solution to the housing issue lies not in price, but in the number of properties available--which needs to increase, with developers supported by government incentives. Some opponents claim that Proposition 33 could result in developers building fewer new rental housing units, exacerbating the housing shortage.
It remains to be seen which of these views will prevail, as the state and nation await the outcome. Proposition 33 could have a significant impact on both housing and the state’s economy, if approved by voters.
What other propositions are on the ballot?
Proposition 33 is one of 10 propositions on the ballot in the November 5 election.Others deal with issues including healthcare, the climate, crime, taxes, public schools, and more, with a potential cost of some $20 billion.
Those wishing to delve deeper into all the propositions, including arguments for and against and fact checking, can visit the nonprofit CalMatters site at https://calmatters.org/california-voter-guide-2024/propositions/.
You may also consult the California State Voter Guide at:
https://voterguide.sos.ca.gov/propositions/
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