Statewide Rent Control, Just ‘Cause

So, despite the fact that 2018’s Prop 10 failed by a wide margin with 59% against, the State of California has decided that they know better than the voters and have passed statewide rent control anyway, 25-10 for the bill. The bill will allow for rent increases not to exceed 5%+CPI (the consumer price index, which is confusing by itself), it DOES NOT exempt low unit landlords, and it is overlaid on top of existing rent control.

It is no exaggeration to say that the state wants to be in the business of housing, to have all the liability be on the owners and for fees, licenses, point of sale retrofits going to the state.

A quick history lesson,

This is a stunning and generational about-face of the landmark 1995 Costa Hawkins legislation that the voters of the state of California agreed to allow rent control to die a slow death. This act did not allow the formation of new rent control by cities. This was written as a direct response to the Rent Stabilization Ordinance (RSO) that created rent control in California in 1979 to reign in the worst excesses of cities such as Los Angeles, Santa Monica and West Hollywood, where they would had what is considered “Vacancy Control”, meaning that rent increases were kept in place EVEN AFTER moving a tenant out and getting a new tenant in. It is amazing.

It is no exaggeration to say that the government wants approval for you to do anything with anything you own. In no legal sense, is this ownership or property rights.

A second, more sinister, and much less understated part of the bill is “Just Cause” Evictions. Which are unprecendented. It is defined below:

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Landlords can no longer terminate month-to-month tenancies at will and may now only evict tenants for one of 15 specific reasons. The permissible reasons are divided into two categories: “at fault” and “no fault.”

“At fault” termination is generally allowed when tenants have breached their lease and does not require the payment of relocation assistance. “At fault” reasons include non-payment of rent, nuisance, criminal activity, refusal to allow entry, and breach of a material term of the lease.

“No fault” termination is allowed even when the tenant has not breached the lease and will require the landlord to pay one month’s rent in relocation assistance. “No fault” reasons include an owner or family member intending to occupy the property, withdrawal from the rental market, substantial remodeling and compliance with a government order to vacate the property,

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Did you catch that? To move your tenant out of your rental property to move your mother in, you have to pay them 1 month rent. To remodel your own house, you have to pay 1 month rent, to COMPLY WITH THE GOVERNMENT, you have to pay 1 month rent. This is truly beyond the pale.

The issue of rent control has always been less about controlling the rental rate itself (it is actually pretty generous), and more about “eviction procedures” and the “how much can we shake down landlords” for doing a job that the federal and state governments have consistently failed with throughout history. A generational fog has set in, where the unmitigated disaster that was public housing (“The Projects”) has faded from memory.

It is no exaggeration to say that the state is coming for it all. 

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