The potential repeal of California’s Costa-Hawkins Rental Housing Act in November could have far-reaching implications, according to Sharon Wilson Géno, president of the National Multifamily Housing Council (NMHC). During Berkadia’s recent webinar on housing affordability, Géno emphasized that nearly 40 states have some form of rent control preemption and warned that what is happening in California could happen across the country.
Rent control preemption laws are not unique to California and there has been a growing trend towards repealing these laws. Mary Ann King, Co-Head of Institutional Solutions at Berkadia who moderated the webinar, cited an NMHC white paper reporting that last year alone 70 bills were introduced in state legislatures nationwide seeking statewide rent control or overturning existing preemptions.
Géno also highlighted how some states have tried workarounds to these laws but ultimately concluded that “rent control hurts the rental market overall.” She added that numerous studies show it primarily benefits higher income individuals and impedes quality over time.
The panelists also discussed how California serves as a bellwether state for housing policy with Thomas K. Bannon from the Californian Apartment Association; Barry Altschuler from Equity Residential; and Jim DeBoo former Chief of Staff for Gov. Gavin Newsom all leading a group called Californians for Responsible Housing which is spearheading efforts against repealing Costa Hawkins through ballot initiatives.
Ultimately though industry leaders believe it is important not only to rally against bad public policy but also propose good solutions such as those seen in Florida where they passed legislation known as Live Local Act which supports affordable housing by removing barriers created by local governments while investing almost $1 billion into affordable housing projects without resorting to rent controls measures like those being proposed in other parts of America today.”
Géno believes this approach can be used effectively elsewhere stating: “We think [the Live Local Act] can serve as a model for other states to follow. Another positive development is the collaboration between national organizations such as the National Apartment Association, Mortgage Bankers Association, National Association of Home Builders and National Association of Realtors who are working together to create education advocacy and messaging around solutions that work while highlighting the dangers of rent control through initiatives like Housing Solutions Coalition.”
To access on-demand replays of this webinar click here.
