• "Spreading the ideas of freedom loving people on matters regarding high finance, politics, constructionist Constitution, and mental masturbation of all types"

Rent hikes will be capped at 5% each year plus inflation, bans no-cause evictions

Scorpio

Скорпион
Founding Member
Board Elder
Site Mgr
Midas Supporter
Joined
Mar 25, 2010
Messages
28,778
Likes
37,428
#1
California governor signs statewide rent-control law

By Associated Press

Published: Oct 8, 2019 8:47 p.m. ET
Share






Rent hikes will be capped at 5% each year plus inflation, bans no-cause evictions




SACRAMENTO, Calif. — California will limit rent increases for some people over the next decade after Democratic Gov. Gavin Newsom signed a law Tuesday aimed at combating a housing crisis in the nation’s most populous state.

Newsom signed the bill at an event in Oakland, an area where a recent report documented a 43% increase in homelessness over two years. Sudden rent increases are a contributing cause of the state’s homeless problem, which has drawn national attention and the ire of Republican President Donald Trump.

“He wasn’t wrong to highlight a vulnerability,” Newsom said of Trump’s criticisms to an audience of housing advocates in Oakland. “He’s exploiting it. You’re trying to solve it. That’s the difference between you and the president of the United States.”

The law limits rent increases to 5% each year plus inflation until Jan. 1, 2030. It bans landlords from evicting people for no reason, meaning they could not kick people out so they can raise the rent for a new tenant. And while the law doesn’t take effect until Jan. 1, it would apply to rent increases on or after March 15, 2019, to prevent landlords from raising rents just before the caps go into place.

California and Oregon are now the only places that cap rent increases statewide. Oregon capped rents at 7% plus inflation earlier this year.

California’s rent cap is noteworthy because of its scale. The state has 17 million renters, and more than half of them spend at least 30% of their income on rent, according to a legislative analysis of the proposal.


But California’s new law has so many exceptions that it is estimated it will apply to 8 million of those 17 million renters, according to the office of Democratic Assemblyman David Chiu, who authored the bill Newsom signed.

It would not apply to housing built within the last 15 years, a provision advocates hope will encourage developers to build more in a state that desperately needs it. It does not apply to single family homes, except those owned by corporations or real estate investment trusts. It does not cover duplexes where the owner lives in one of the units.

And it does not cover the 2 million people in California who already have rent control, which is a more restrictive set of limitations for landlords. Most of the state’s largest cities, including Los Angeles, Oakland, and San Francisco, have some form of rent control. But a state law passed in 1995 bans any new rent control policies since that year.

Last year, voters rejected a statewide ballot initiative that would have expanded rent control statewide. For most places in California, landlords can raise rent at any time and or any reason if they give notice in advance.

That’s what happened to Sasha Graham in 2014. She said her rent went up 150%. She found the money to pay it on time and in full, but her landlord evicted her anyway without giving a reason. She was homeless for the next three years, staying with friends, then friends of friends and then strangers.

“Sometimes I lived with no lights, sometimes I lived with no water, depending on who I was living with (because) they were also struggling,” she said. “Sometimes I just had to use my money to go to a hotel room so I could finish my homework.”

Graham, who is now board president for the Alliance of Californians for Community Empowerment, now lives in family housing at the University of California, Berkeley, where she is scheduled to graduate in May. She said the law, had it been in place, would have helped her.

But Russell Lowery, executive director of the California Rental Housing Association, says the law adds an expensive eviction process that did not previously exist. He said that will encourage landlords to increase rents when they otherwise wouldn’t.

“It adds unnecessary expenses to all rental home providers and makes it more difficult to sever a relationship with a problem tenant,” he said.


https://www.marketwatch.com/story/c...t-control-law-2019-10-08?mod=mw_theo_homepage
 

Joseph

Gold Member
Gold Chaser
Sr Site Supporter
Joined
Jul 27, 2011
Messages
4,822
Likes
9,130
Location
south east
#2
Rent hikes will be capped at 5% each year plus inflation, bans no-cause evictions
Perfect. Look to Cali property owners selling everything they own quickly now - while there are still people stupid enough to buy
 

nickndfl

Midas Member
Midas Member
Midas Supporter
Joined
Jan 7, 2011
Messages
13,580
Likes
12,704
Location
Florida
#4
The housing shortage is caused by huge bureaucratic regulations and fees on new constructions in California. That's why you see so many refurbs. It costs too much to build unless you are rich. It also inflates housing prices.

I can build a new home in Florida in 8 months for $100 ac sq ft. The land costs anywhere from $20k to $80k+ depending on where.
 
Last edited:

oldgaranddad

Gold Member
Gold Chaser
Midas Supporter
Joined
Feb 21, 2012
Messages
4,899
Likes
8,499
Location
On the top shelf.
#5
Perfect. Look to Cali property owners selling everything they own quickly now - while there are still people stupid enough to buy
Look for California to become the Bronx, NY in the 1970s where landlords either abandoned their properties or were stuck with non paying tenants due to rent control that so many resorted to the euphemistic term “Jewish lightening” and burnt them out only to warehouse the shells and foundations for decades. The fact that NYC relied on think tank consultants who knew nothing about urban dynamics only to throw proverbial gasoline on the fires by closing firehouses, you had a recipe for disaster.

Fifteen years ago they started to rebuild the Bronx as the Rudy Guilliani building boom spread to the outer boroughs. There are actually some nice areas of the Bronx that people swore would never come back.

Now the idiot NYC mayor is pushing rent control laws, fire and police cuts that will result in a repeat of the 1970s all over again.
 

Buck

Old Member
Gold Chaser
Site Supporter
Joined
Apr 13, 2011
Messages
7,559
Likes
7,207
#6
2000, what's 5% of 2k?
$100 per month
So, From $2000 per month, the First Year
Next year, it's $100 extra per month 2100 Second Year
Following Year it's $105 2205 Third Year
Following year it's up $110 2315 Forth Year
Following Year it's up $115.75 2490 Fifth Year

Following Year it's up $124.5 2614.5


Whose wages keep up with that type of increase?
It doesn't look right, it doesn't look like any landowner lost anything...
 

nickndfl

Midas Member
Midas Member
Midas Supporter
Joined
Jan 7, 2011
Messages
13,580
Likes
12,704
Location
Florida
#7
The point is landlords need flexibility in what they charge for rent, especially when they need to dump money back into a property after a tenant has wrecked it.
 

Buck

Old Member
Gold Chaser
Site Supporter
Joined
Apr 13, 2011
Messages
7,559
Likes
7,207
#8
The point is landlords need flexibility in what they charge for rent, especially when they need to dump money back into a property after a tenant has wrecked it.
so, is it easier to just forward-charge the last renters anger onto the new renters, rather than chase the asshole down and shake it out of him?
 

nickndfl

Midas Member
Midas Member
Midas Supporter
Joined
Jan 7, 2011
Messages
13,580
Likes
12,704
Location
Florida
#9
They lose a deposit, but sometimes repairs require more. Plus insurance and taxes go up too.
 

Buck

Old Member
Gold Chaser
Site Supporter
Joined
Apr 13, 2011
Messages
7,559
Likes
7,207
#10
i really had zero idea, residential rental property is not on my bucket list...but, property taxes in Ca don't change much due to Prop 13 from a few decades ago...that Proposition Jarvis/Gann saved Californians trillions in property taxes over the years...

anyway, thanks for the share...
 

nickndfl

Midas Member
Midas Member
Midas Supporter
Joined
Jan 7, 2011
Messages
13,580
Likes
12,704
Location
Florida
#11
In Florida tax millage is capped at 3% annually for primary homesteads, but not on others. My property taxes went up 10% YOY even though the millage went down. The assessed value climber with nice paper profits.
 

edsl48

Silver Member
Silver Miner
Site Supporter ++
Joined
Apr 2, 2010
Messages
2,642
Likes
5,043
#12
Ages ago my mother rented an apartment where the landlord never increased the rent because she was a good tenant blah blah. When Nixon instituted price controls he, the landlord, immediately increased her rent. He explained that with price controls he would be unable to raise the rent when and if needed by outside circumstances so he was raising the rent when he could. My assumption then is every renter in Ca better be ready for a price hike.
 

Fatrat

Silver Member
Silver Miner
Site Supporter
Joined
Apr 15, 2018
Messages
3,240
Likes
2,717
#13
Worst case scenario, what happens if landlords sell their properties? Housing prices should fall.
 

Mujahideen

Black Member
Midas Member
Site Supporter
Joined
Mar 31, 2010
Messages
11,225
Likes
20,566
Location
Wakanda
#15
The government fixing problems, lol.
 

Treasure Searcher

Platinum Bling
Platinum Bling
Joined
Apr 1, 2010
Messages
4,391
Likes
2,865
#16
The landowners will eventually lose. Wear and tear on any building and associated property will result in repairs/replacements (new carpet, repainting, water heater replacement, A/C system, parking lot resealing, etc.).

The return on investment (ROI) will decrease from just that. Add to the renovations/updates that California codes are notorious for and ROI will
dwindle.

Renters will have to live without amenities. Close the swimming pool, shut off the A/C and other measures the landlord will have to resort to.