Santa Ana’s Measure CC promises “rent stabilization” which sounds good – until you see how it plays out.
Since 2021 when the city passed the “rent stabilization and just cause eviction” laws via city ordinance, the city has witnessed:
- No new major housing projects submitted
- Annual rent increases to the maximum allowable increase each year in over 90% of properties
- Lower vacancy rates than before 2021 – which leads to less available housing options
- All of this means Santa Ana is less affordable today than it was prior to passing rent stabilization
Santa Ana is not unique in having this problem.
- San Francisco has an estimated 50,000 units that are kept off the market due to the rent stabilization laws
- Santa Monica is a wealthy beach enclave where rent stabilization has created a cottage industry of vacation rentals run by tenants
- Venice in Los Angeles has buildings in disrepair due to low rental rates from rent stabilizationBerkeley’s units are held by long-term tenants that sublet the units at market rates the building owner does not receive
- Oakland… well they have rent stabilization… anyone want to be like that?
And these experiences aren’t unique to California
- St. Paul, Minnesota had to repeal their rent stabilization ordinance after builders pulled out of all projects
- New York has entire blocks of off-market buildings due to rent stabilization
- Chicago’s rent stabilization has given rise to a cartel like control of stabilized units
Rent stabilization is intended to assist low-income individuals and families able to afford their units. In practice, however, it creates the exact opposite as rents go up, options disappear, and people cannot afford to move. Rent stabilization traps people rather than helps them.
What is worse, it creates a need to administer this program – which of course comes at a cost. The cost in Santa Ana can be split between the owner and the tenants. So, we are increasing the cost of housing to make it more affordable.
Ignoring the obvious irony of that concept, it leads one to ask how has the city been doing?
The city of Santa Ana has only collected rent registry fees from approximately 15% of rental units. As a result, the city has spent millions of dollars of general fund money and borrowed millions more from the Affordable Housing Fund meant to help build new affordable units.
Where does this end? Look at Pasadena where the un-elected rent board members have voted themselves full-time jobs and salaries higher than that of the city council.
Proposition 33 seeks to expand this failed policy statewide. Potentially leading to over 500 similar local rent boards following Pasadena and Santa Ana’s lead of borrowing money from affordable housing funds to pay themselves and consultants millions of dollars every single year.
Worse, Proposition 33 expands governments’ control over housing to include new developments and single-family homes which would now be subject to “stabilization.”
Proposition 33 and Measure CC seek to support those who are struggling to afford housing. In practice they make the situation worse for many more individuals who were better off before anyone decided to “help.”
Are there people in need of housing assistance? Absolutely. And, there are many existing programs to help people in need – and each of those programs focuses on the needs of the individual applicants instead of this “one-size-fits-all” approach. Is there more that can be done? Certainly, and they are worthy of exploring.
Housing policy approaches needs to rely on:
- Individual needs for assistance
- Adaptability to meet the changing needs of tenants over time
- Flexibility to allow people the mobility necessary to grow
Unfortunately, these two proposals provide the opposite of what is truly needed for people to thrive in our communities.
Vote no on Proposition 33 and Measure CC. No one should be trapped in their homes.
Chip Ahlswede is vice president of external affairs at the Apartment Association of Orange County.
