LA County to Impose Rent Cap in Unincorporated Areas
Over protests from landlords and real estate brokers, the Los Angeles County Board of Supervisors voted 4-1 Tuesday in favor of an ordinance to temporarily limit rent increases to 3 percent in unincorporated areas of the county.
Dozens of renters turned out carrying signs reading “The rent is too damn high,” while many landlords and agencies that represent property owners countered that the ordinance would hurt rather than boost housing supply.
Supervisor Kathryn Barger cast the dissenting vote against the interim ordinance, which is expected to come back to the board for another vote in 60 days and, if adopted, to take effect 30 days later. It would set base rents as of Sept. 11 and impose a cap for six months.
Supervisor Sheila Kuehl championed the plan to limit rents while the county considers longer-term solutions, saying it will help solve the homelessness crisis.
She said she was mystified by some policymakers’ inability to see the link between rental rates and homelessness.
“They look at 58,000 homeless people in Los Angeles County and they say why?” Kuehl said.
Helping those living on the street with mental illness has been a critical focus, but Kuehl pointed to statistics showing that only one-third of the homeless population has an identifiable mental health problem. Most of the remaining two-thirds are newly homeless and without a home because of economic issues, she said.
Seniors are particularly hard-hit, Kuehl said. The last annual point-in-time count by the Los Angeles Homeless Services Authority found a 22 percent jump in homeless people 62 years and older.
Advocates on both sides said research was on their side.
Kuehl and Supervisor Hilda Solis, who co-authored the motion, cited research by USC and UCLA professors finding that rent regulations can help make housing more affordable.
“Limiting rent increases cannot fully solve the housing crisis confronting much of urban California, but rent regulations are one tool to deal with sharp upticks in rent and have less deleterious effects than is often imagined,” said Manuel Pastor, a USC sociology professor.
However, the argument seems unsettled. Recent research by Stanford University professors concludes that rent control incentivizes condominium conversions and sales to owner-occupants, reducing the supply of rental housing and increasing gentrification.
In evaluating the effects of a proposed repeal of the 1995 Costa-Hawkins Rental Housing Act — which limits rent control to older housing stock — the state Legislative Analyst’s Office concluded that rent control would likely lower rents but also reduce new construction and lower property values.
Beverly Kenworthy of the California Apartment Association told the board that “rent control is not the same as affordable housing” and once the ordinance is passed, “(renters) will still not be able to afford their rent.”
However, Tyler Anderson of the Los Angeles Center for Community Law and Action told the board that tenants are seeking help with rent increases of 40 to 80 percent.
Beverly Roberts, a 30-year resident of South Los Angeles who advocates rent control and also owns income property, said she is seeing her “community being ripped apart” by high rents. “Landlords don’t need to gouge tenants to get a fair return on our investment.”
Some in favor of rent control said private equity firms are buying up property, while landlords and landlord associations said the county ordinance would hurt small property owners and decrease the value of properties they worked hard to own.
“They are flesh-and-blood people who scrimped and saved” to afford their properties, Janet Gagnon of the Apartment Association of Greater Los Angeles said of “mom-and-pop” owners. “They are being clubbed like baby seals with this rent freeze.”
Landlord advocates suggested other solutions, including offering rental vouchers for seniors and low-income renters.
Others suggested the county was meddling where it shouldn’t.
“Are you now going to start telling the gas stations what they can sell their gas for? Are you going to tell Albertsons what they can sell their milk for?,” a real estate broker asked.
Kuehl replied, “I don’t know, I’ll talk to Chevron about that.”
Barger offered an amendment that would allow owners to “bank” increases from year to year and give landlords greater leeway to evict tenants during the first two years of their lease.
“I do not believe rent control is the right way to go,” Barger said, but indicated she would vote for the ordinance if her amendment was accepted.
“I appreciate your stretching to get there,” Kuehl said, but urged her colleagues to vote against the proposed amendment, which failed to get a second.
Supervisor Mark Ridley-Thomas, who abstained from a vote last week that put a similar cap on rents at mobile home parks in unincorporated areas, highlighted the temporary nature of the measure.
“While rent control is often described as a blunt or inelegant tool during times of crisis, it is warranted to prevent displacement and to protect tenants,” he said. “Unlike Prop 10, the rent increase moratorium considered by the board today was designed to be temporary. It is our job to create a safety net when needed, and now is one of those times.”
The ordinance, if ultimately adopted, is estimated to affect 200,000 people living in rental properties.
Solis urged other cities to “do the right thing” and join the county in imposing rent regulations.
Proposition 10, the ballot measure to repeal Costa-Hawkins, will go before voters on Nov. 6.