Concord City Council
October 10, 2023

9/27/2023
03:09 AM

From: Meina Young <[email protected]>
Sent: Tuesday, October 10, 2023 12:19 PM
To: City Clerk <[email protected]>
Subject: Strongly oppose rent restrictions
Dear Concord Officials,
Please preserve the thriving Concord community; please resist falling into the death traps of socialistic oligarchic faliures of draconian rent control (stabilization)and "just cause" evictions which unfairly outlaws private contracts and lease terms. Blindly copying these proposed policies will hurt the vulnerable community members who depend on fixed income, push out the limited mom and pop rental housing supply which will only worsen the housing shortage and costs, remove viability and opportunities for renters to become future housing providers and divide communities as seen in Oakland and San Francisco.

Please set the example to respect private property as you sworn to protect under the US Constitution, provide impartial services to mediate and alleviate housing disputes and allow private parties to enforce their mutual lease agreements and thrive.

Thank you for your consideration.

Meina Young
Homeowner, mother of 2 renters, a community member

From: Rhovy Lyn Antonio <[email protected]>
Sent: Tuesday, October 10, 2023 1:16 PM
To: Hoffmeister, Laura <[email protected]>; Birsan, Edi <[email protected]>; Aliano, Dominic <[email protected]>; Nakamura, Laura <[email protected]>; Obringer, Carlyn <[email protected]> Cc: Huckabay, Sophia <[email protected]>; Barone, Valerie <[email protected]>; City Clerk <[email protected]> Subject: Letter from CAA re: Item 5A Rent Control Workshop Good afternoon Mayor Hoffmeister and City Council,
Please see the attached letter from California Apartment Association (CAA) for tonight’s continued workshop on rent control and just cause regulations. I am available for any questions.

Thank you for your consideration of the information presented.

Best,
_____
Rhovy Lyn Antonio ▪ Senior Vice President, Local Public Affairs California Apartment Association
[email protected] ▪ (408) 342-3506
CAA is your partner in the rental housing industry.

Find out how we're working for you.

CAA Services: Events and Education Insurance Tenant Screening

October 9, 2023
Concord City Council
1950 Parkside Drive
Concord, 94519
Re: 10/10/23 City Council Agenda item #5A Rent Control & Just Cause Eviction Workshop
Honorable Mayor Laura Hoffmeister and Members of the City Council, The California Apartment Association (CAA) represents local rental housing providers in Concord who provide quality, safe rental housing for Concord renters. We engaged our members as well other local owners on the current rent and eviction control proposals to give them a voice at city hall and raised awareness on the various restrictions that the Concord City Council would be imposing on their rental homes.

As the leading organization in Concord that serves the rental housing industry, local owners, majority of which are family-owned and operated, sought CAA’s assistance to supply the city with real data, facts, and figures that reflect the economic reality of rental housing in the City of Concord. CAA was also consulted by the city to obtain information on how local rent control formulas impact housing providers. Thus, CAA conducted a research of Concord owners to respond to this information request.

The data below demonstrates real-life figures of expenses to operate rental housing properties in the City of Concord. We submit this letter to supplement city staff’s report on the state of the rental housing industry and to provide the city council with critical information to demonstrate the impacts of a local rent control proposal would have on local rental housing.

First, it is important for the city to acknowledge the growing expenses and financial obligations to providing housing for Concord residents in relation to capping the revenue stream these properties provide. It is also important to acknowledge that owning rental housing is a form of business. Thus, it is expected that the investment generate revenues, which in turn provides as a source of income and retirement plans for the housing providers. The discussion of rent control often falls on the ideological notion that rental housing should be offered at zero to low cost to the renter. Again, as a private investment and a source of livelihood, this business model simply does not exist without substantial subsidies from government.

CAA compiled data of operating expenses that fall in major categories such as utilities, taxes, payroll, and etc. To preserve the sensitive and proprietary nature of the data, the names and address of these buildings have been omitted for city submission.

However, CAA has encouraged those who submitted the data to also share them with the city if they feel comfortable in doing so.

The findings of our survey are outlined as follows:

Insurance Incurred Largest Increase
The highest expense noted is insurance. From the five-year data reviewed, the average increases in insurance premiums are in the double digits and hovered around 21-25% for all unit types. This figure is above the national year-over-year change of 18.8% as identified by Yardi Matrix in their 2023 September report. The largest uptick in increases happened from 2020 -2021 and the upward trend continues.

Repairs and Maintenance
Repairs and maintenance showed the highest fluctuation rate. Housing providers reported expenses stabilizing in some years. However, one repair project would often double the expenses in a given year. For example, the chart below shows the fluctuations in a 20-unit building built in the 1960s:

Expense 2019 2020 2021 2022 2023
Repairs/Maintenance -7% 70% -34% -53% 100%
*Figures in red denotes a rate decrease
A housing provider would need to account for an average of 15% increases year-overyear in repair and maintenance costs to have funds available for an unforeseen repair.

This figure is slightly higher than the national average of 14.2% according to Yardi Matrix.

Most Operating Expenses Increased by Double Digits
CAA’s survey indicates that operating expenses are in the double digits. With the exception of taxes, expenses in the major categories such as administrative, payroll, utilities, management, and marketing rise well above 10%. This is consistent with findings from Yardi Matrix that states rental markets in the western region typically rank higher than national averages.

The chart below demonstrates a typical rate of increases in a portfolio of properties built in the 1960s:

Expense 2019  2020 2020 2021 20212022 20222023
Insurance 46% 67% 27% 9%
Repairs/Maintenance 3% -24% 72% 8%
Administrative 37% -16% -1% 7%
Payroll -1% -2% 8% 24%
Utilities 3% 13% 5% 9%
Management 2% 4% 6% 4%
Taxes 3% 1% 3% 2%
Marketing 5% -16% -21% 96%
Other Notable Expenses –
Unit Turnover -31% -29% 43% 51%
Capital Improvement Amounts
CAA gathered data on Concord housing providers who have either completed capital improvement projects in the past five years or have projects scheduled in the near future. Some figures are in the millions. The list below demonstrates the true dollar amount of some of these improvements that either already occurred at Concord rental properties or based on contractors’ estimates on future projects. The property sizes vary from a 2-unit condo to a larger 100+ unit complex. What is not included below is other expenses required by new laws such as the statewide requirements for balcony inspection program:

Project Amount Building Age
6-Year Capital Projects:
- Window
replacements,
common pool deck,
10-year smoke
alarms, exterior safety
lights, building roofs,
etc.
$3.055M 1970s
Replacement Galvanized
Water Pipes
$1M+ 1960s
Patio/Window Replacements $695,000 1960s

Electrical Main & Sub-Panel
Replacements
$600,000 1960s
Plumbing $568,802 1970s
Fire Alarm Retrofit $300,000 1960
New Roof $393,000 1960s
Individual unit renovations $179,500 1970s
Seismic Retrofit $94,000 1960s
Community pool plaster $40,000 1960s
Carport Roofs $30,064 1960s
Electrical Panel Upgrade $16,700 1960s
ADA Modifications $15,000 1960s
EV Parking Charging Outlet $11,000 1960s
Fences and gates $10,000 1960s
Cost to Operate – Per Unit Amount
Concord city staff reports that as of June 2023 the average property operating cost is approximately $8,700 per unit representing a 9% increase from June 2022 for the western region. The City of Concord sought CAA’s assistance on obtaining local figures which led CAA to solicit the information from local owners. Our findings concur with this average with an additional notes that some properties reported much higher figures just under $10,000, and some fluctuations are due to differing amenities such as community club house, pool, landscaping, and other benefits made available to the renters.

This symbolizes the unsustainable and infeasible economic reality Concord housing providers are facing if the city adopts a rent control formula of 3% or 60% of CPI or lower. They face heavy losses or risk going into default.

CAA emphasizes that many of these properties are the housing providers’ income.

This is their livelihood. It is crucial that these factors are included in the conversation before the city mandates that housing providers live under a permanent fixed income.

Other Factors to Consider
Interest Rates:

As the City Council continue to evaluate the rent control formula, it is important to also consider the mortgages and debt obligation Concord rental properties have. Contrary to single-family home purchases, multi-family properties with five units and up do not fall under a 30-year fixed financing option. Most have 5-7 year-fixed loans which adjust to market rate at the end of the fixed-rate term. Given today’s interest rates and the projected increases in the future, the city must recognize that many of the properties will have to refinance under much higher interest rates—some double the rate they are currently in. The chart below demonstrates some properties who will be refinancing in the near future. Hence, additional increase debt obligations which also increases operating expenses:

Current Loan Maturity Current Interest Rate
10/2026 3.54%
10/2026 3.54%
11/2026 3.13%
5/2028 4.67%
5/2028 5.75%
Vulnerable Population Definition:

The city’s proposed definition of “vulnerable population” identified demographic groups that are typical in other local ordinances that require higher relocation payment than the statewide Tenant Protection Act of 2019/AB 1482.

For clarity, CAA recommends that “Individuals with ADA disabilities” be reworded to “Individuals with disabilities as defined by the ADA.” An individual with a disability is defined by the ADA as a person who has a physical or mental impairment that substantially limits one or more major life activities, a person who has a history or record of such an impairment, or a person who is perceived by others as having such an impairment.

For “Lower income household,” the city should also define what qualifies under this category and what metric will be used for the definition.

For practical application of this proposed requirement, the city should establish a process for a renter household to qualify for the enhanced relocation payment. CAA recommends that a provision is added to require the renter to notify the housing provider of their eligibility and for the renter to prove their eligibility.

This provision would establish a process in place and the housing provider will not be forced in a position to ask for this eligibility because asking for information such as health and medical record could also raise Fair Housing issues.

School Year Restrictions
CAA members are concerned with proposals to enact additional restrictions for tenancy adjustments during the school year as this definition is often loosely defined. It is not uncommon for one local jurisdiction to have multiple school districts within its city limits. Some have different calendar year. These variations apply especially to public and private schools. CAA has done work with other jurisdictions that have attempted to define this term. In attempting to do so, jurisdictions found that the requirement is not feasible in practicality, so the proposal did not move forward.

CAA, its members, and the coalition of concerned local housing providers are hopeful that the information presented here, in addition to the personal letters sent to the city council are carefully considered as the city crafts the new regulations. We are available for additional questions.

Best,
Rhovy Lyn Antonio
Senior Vice President, Local Public Affairs
California Apartment Association

From: Gary Ding <[email protected]>
Sent: Tuesday, October 10, 2023 2:08 PM
To: City Clerk <[email protected]>
Subject: comment regarding rent control
Dear Sir/Madam,
I have one rental in Concord and my tenants have been there for a long time. This said the current rent is very low and I only raised the rent for twice in the past over a decade. My point is, it is between the landlord and the tenant to decide the rent. In my situation, if there is a new CAP applied to the increase, I'd have to lease it for a very low rent forever. In this situation, I would have to quit the market by selling my property.

To be clear, I oppose the proposed regulations in rent control.

Thanks for listening.

Gary Ding

From: Tina <[email protected]>
Sent: Tuesday, October 10, 2023 2:45 PM
To: City Clerk <[email protected]>
Subject: Rent Stabilization for City of Concord
Dear City Council,
I am a small apartment owner and have been for 30 yrs. I have maintained my units (4) for that time. As I have watched the City of Concord grow and develop, I have taken pride in maintaining my property according to the cities requirements. I have managed to keep tenants for extended periods of time, by keeping rents at an affordable amount and not gouging my tenants. You "The City of Concord" have over the years added and increased various taxes, fees and costs that the city feels THEY need. The latest being this rental registry, which was only a method of you gathering information about rentals, to start a foundation for this CAP you want to propose. As I see it you are basing your decision on a 6 hr meeting, with less that 100 people speaking. This has increased the cost of living in Concord way above the the national average, and many other California cities. Now you want to prohibit us from raising rents to cover all the costs that the State, County and City impose upon us by putting on a CAP. Let alone, as a landlord trying to make any profit from our investments. This needs to be voted on by the landlords of Concord, not a City Council. Are any of you property owners? Do you have any idea what it's like to maintain property. As far as evictions, if it wasn't for COVID, we would still have the right to evict a tenant for the reasons of, not paying rent, breaking the law, squatting, etc. Not we have to get their permission to get rid of them.

I will continue to operate my property in the manner I see fit.

Thank you,
Christine Black

City Clerk Joelle Fockler,
Dear Concord City Council,
I am glad to see the Council has committed to passing tenant protections by the end of this year to address the housing affordability crisis and to help limit growing unjust evictions in Concord.

Concord renters – over 40% of Concord residents– need a strong and effective policy that actually addresses the unstable and skyrocketing rents in this city and creates lasting stability for families, younger generations, and seniors. This is only possible if City Council members hold firm to their commitment to the 3% cap or 60% of AMI (whatever is lower), which an overwhelming number of public comments demanded during the Sept. 5th Council Meeting. With this policy, Concord will keep families housed by providing a predictable and reasonable rent cap that is more connected to people’s wages.

According to the City’s Housing Element, rents increased by 62% between 2011 and 2021, far outpacing the growth of renter incomes. A lot of this is driven by the influence of corporate ownership and the desire to maximize profits, at the expense of the community. Unfortunately, corporate investors – not local "mom-and-pop" landlords – dominate Concord's rental market. Sixty six percent of multi-family units in Concord are owned by the top 10% of landlords, which include about 50 companies. Meanwhile, only 15% of multifamily units and 22% of investor-owned units in Concord are owned by local investors.

I applaud the progress Council made during the Sept. 12th meeting to help ensure the ordinance protects residents from corporate greed, but I believe that the Council needs to do more to make sure this ordinance has teeth and is actually having the full intended results of keeping families housed and preventing homelessness.
• First, the Council should create a robust self-financing rent program by levying modest fees per unit on landlords, as other cities have done. A couple hundred dollars a year for a rental property owner is a negligible cost, and this funding would expand city staffing capacity to ensure the ordinance is effective and regulated while not overburdening current staff. • Next, tenants should not be charged fees for submitting petitions to the City *about possible violations of the law*. This will undermine the enforcement of the law, as it will financially disincentivize many low-income renters from defending their rights by submitting a petition. • Also, it is important for this local ordinance to stop the fraudulent evictions that have become common where landlords claim they need to do "substantial renovations," which actually never

happen. Landlords should be required to show proof of intended renovations, and the City to levy fines for those who make false claims in order to evict working-class tenants. • Finally, it is important that those who are temporarily relocated during legitimate renovations need the right of return to their unit at the same price to ensure that they can fairly stay in their home in Concord and aren’t being punished for their landlord's responsibilities of upkeeping a habitable unit.

I strongly stand by these demands in this e-letter as being necessary for Concord’s Just Cause and Rent Stabilization ordinance to truly be effective and enforceable in protecting people like me and my neighbors from Concord’s current unpredictable and escalating rent increases and increasing unjust evictions.

I am counting on your leadership to craft strong policies that will help children, seniors and working class families remain in Concord, stop unnecessary evictions, reduce the City’s growing homelessness, and invest in making Concord more affordable.

The following people submitted the above email:
# First Name Last Name City
1 Michelle Puckett Richmond
2 Carla Castillo Martinez

From: Carlos Olaizola <[email protected]>
Sent: Tuesday, October 10, 2023 3:01 PM
To: City Clerk <[email protected]>
Subject: Concord City Council Needs a Strong and Enforceable Rent Stabilization and Just Cause Ordinance
City Clerk Joelle Fockler,
Dear Concord City Council,
I am glad to see the Council has committed to passing tenant protections by the end of this year to address the housing affordability crisis and to help limit growing unjust evictions in Concord.

Concord renters – over 40% of Concord residents– need a strong and effective policy that actually addresses the unstable and skyrocketing rents in this city and creates lasting stability for families, younger generations, and seniors. This is only possible if City Council members hold firm to their commitment to the 3% cap or 60% of AMI (whatever is lower), which an overwhelming number of public comments demanded during the Sept. 5th Council Meeting.

With this policy, Concord will keep families housed by providing a predictable and reasonable rent cap that is more connected to people’s wages.

According to the City’s Housing Element, rents increased by 62% between 2011 and 2021, far outpacing the growth of renter incomes. A lot of this is driven by the influence of corporate ownership and the desire to maximize profits, at the expense of the community. Unfortunately, corporate investors – not local "mom-and-pop" landlords – dominate Concord's rental market.

Sixty six percent of multi-family units in Concord are owned by the top 10% of landlords, which include about 50 companies. Meanwhile, only 15% of multifamily units and 22% of investorowned units in Concord are owned by local investors.

I applaud the progress Council made during the Sept. 12th meeting to help ensure the ordinance protects residents from corporate greed, but I believe that the Council needs to do more to make sure this ordinance has teeth and is actually having the full intended results of keeping families housed and preventing homelessness.

Benched Correspondence (received
after 3 p.m. on October 10, 2023)
Agenda Item No. 5.a
October 10, 2023

• First, the Council should create a robust self-financing rent program by levying modest fees per unit on landlords, as other cities have done. A couple hundred dollars a year for a rental property owner is a negligible cost, and this funding would expand city staffing capacity to ensure the ordinance is effective and regulated while not overburdening current staff. • Next, tenants should not be charged fees for submitting petitions to the City *about possible violations of the law*. This will undermine the enforcement of the law, as it will financially disincentivize many low-income renters from defending their rights by submitting a petition. • Also, it is important for this local ordinance to stop the fraudulent evictions that have become common where landlords claim they need to do "substantial renovations," which actually never happen. Landlords should be required to show proof of intended renovations, and the City to levy fines for those who make false claims in order to evict working-class tenants. • Finally, it is important that those who are temporarily relocated during legitimate renovations need the right of return to their unit at the same price to ensure that they can fairly stay in their home in Concord and aren’t being punished for their landlord's responsibilities of upkeeping a habitable unit.

I strongly stand by these demands in this e-letter as being necessary for Concord’s Just Cause and Rent Stabilization ordinance to truly be effective and enforceable in protecting people like me and my neighbors from Concord’s current unpredictable and escalating rent increases and increasing unjust evictions.

I am counting on your leadership to craft strong policies that will help children, seniors and working class families remain in Concord, stop unnecessary evictions, reduce the City’s growing homelessness, and invest in making Concord more affordable.

Carlos Olaizola
[email protected]
4825 Joelle dr
Concord , California 94521

From: Sam Engineer <[email protected]>
Sent: Tuesday, October 10, 2023 3:36 PM
To: Hoffmeister, Laura <[email protected]>; Obringer, Carlyn <[email protected]>; Aliano, Dominic <[email protected]>; Birsan, Edi <[email protected]>; Nakamura, Laura <[email protected]>; City Clerk <[email protected]>
Subject: concord rent control
Dear Councilmembers
As you all are considering restricting the rent to 3% or 60% of CPI I would like to draw your attention to one of the 7 habits by Franklin Covey.

Habit 4: Think win-win
The reason this is important is the role we landlords provide in keeping everything in balance. This is also one of the reasons for the current UAW strike and the Kaiser strike. In both cases someone will suffer the consequences of not thinking win-win.

I try and teach this to my daughter everyday. The importance of keeping a balance in this crazy world we live in.

We landlords have a duty to provide a safe environment for our tenants. We suffered the most during the COVID pandemic. In spite of the losses we took we continued to provide the services out of our own savings. I manage a building that was built in 1970 that needs constant repairs to keep the tenants safe. I have to spend more money each year than the previous year in just the upkeep. I could do the bare minimum but that would not be a safe environment for the families.

The current economic climate has made it very tough for all consumers with inflation hitting 5% plus. We have had increases in sewer, water, electricity and insurance and taxes each year. We cannot continue to absorb these costs and still be able to provide a safe environment.

Your current strategy to help tenants by limiting the increase to 3% or 60% CPI is not a win-win strategy.

For us to provide a safe environment for our tenants I would request you to not proceed with this change and revert back to current guidelines.

I have had the same tenants live in my apartment complex since 2013. Prior to me they have lived in the same place with the prior owners for 10 plus years. Tenants like owners who take care of the facilities and provide their families an environment that is great for their families. The quality of services we provide reflect in the quality of life our tenants and their families live. We have a duty to make sure everyone deserves a safe environment. Please do not tilt this balance by pursuing the current strategy of 3% or 60% of CPI. It will not work and balance will be tilted.

Thank you
Porus Engineer
Landlord
4 unit apartment complex in Concord
Monument Blvd and Reganti

From: Joe Stokley <[email protected]>
Sent: Tuesday, October 10, 2023 3:47 PM
To: Hoffmeister, Laura <[email protected]>; Obringer, Carlyn <[email protected]>; Aliano, Dominic <[email protected]>; Birsan, Edi <[email protected]>; Nakamura, Laura <[email protected]>; City Clerk <[email protected]>
Cc: Joe Stokley <[email protected]>
Subject: from Joe Stokley , President of CCRIM / regarding rent stabilization Good afternoon, Concord City Counsel members.

I write you today , speaking on behave of the CCRIM ( Contra Costa Real Estate in Motion ) as its 2023 President .

The members of CCRIM request that the Concord City Counsel not move forward with the Rent Stabilization Program for Concord .

The State of Californias AB 1482 covers these concerns , at a minimum give this law that has only been on the books for three years a chance before ordering more strict and restrictive rules on property owners.

We believe that this will cause more harm then good .

To back up our position , please read the article that is attached above " Has Rent Control Caused Homelessness"
We the members of CCRIM appreciate your consideration.

Sincerely
Joe Stokley, Jr.

BRE #01119080
Principal-Broker
Stokley Properties, Inc.

Office: (925) 658-1415
Direct: 1-(925)-878-1603

32 AOA News and Buyers Guide • East Bay / San Francisco • May 2023 • (510) 769-7521 • (415) 632-4662 My father was deployed in the
Pacific Theater in the Infantry.

He sustained a wound, actually
several and was transported to
San Diego for surgery and recovery.

When he was discharged
from the military, he had no
formal education and of course,
there were “quotas” for Jewish
persons.

So many Jews who couldn’t
go to college went into the
trades: plumbers, electricians,
architects, trash hauling, cement vendors. This vibrant Jewish community thrived in
Los Angeles. They were captains of industry. They were prominent in the garment industry and the four largest shoe factories in Los Angeles were
owned by prominent Jewish
families.

Families Worked and
Invested for Education
& Retirement
From time to time, these underserved communities, whether Jewish, African-American or Hispanic, were able to buy and
acquire some small apartment
complexes. Over time, they
His sister died when he was
young, and his two brothers
worked as children to support
the family. They were fortunate,
as most of his relatives didn’t
survive the Holocaust and others lived in sections of Russia.

I am a liberal/progressive
Democrat, and I live in
West Los Angeles, several
miles west of the UCLA campus. Yes, I’m a member of several or more local Democratic Clubs.

I’m not going to discuss with
you the Constitutional concepts
of “taking” of private property
without due process, a hearing
or compensation, as outlined
in the First Amendment to the
United States Constitution.

I’m going to discuss my
family’s history with you.. My
father was born in Lynn, Massachusetts. For the first six years of his life, he could only
speak Yiddish and Hebrew. He
did not learn English until perhaps the first or second grade in school.
by Michael Millman, Esq.

Has Rent Control Caused
Homelessness?
You can evaluate every
community and discover
that oppressive
rent control encourages
the owners to sell to
developers and units
are lost. Is it just plain
stupid to ignore the fact
that “tenant welfare”
(rent control) caused
good people to be
homeless?
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36 AOA News and Buyers Guide • East Bay / San Francisco • May 2023 • (510) 769-7521 • (415) 632-4662 sold a few and purchased some
larger units.

In the Orthodox Jewish
communities, the apartment
owners of course were Jewish
and allowed their neighbors,
friends and others in their Synagogues to live in the units for very little money.

Those are the people who
you now target for reprehensible and oppressive rent control.

Even my friend and Los
Angeles Major, Karen Bass,
was able to go through school
because her Father owned several apartment complexes and underwrote her education.

How Rent Control
Destroys Housing
There is extensive rent control in California: Berkeley, Oakland, San Francisco, Santa Barbara, West Hollywood, Beverly Hills, Culver City,
Inglewood, Los Angeles and of
course, Santa Monica.

Fifty years ago, when rent
control was established in Santa Monica, there were approximately 50,000 apartment units built, of course, to accommodate the thriving airplane manufacturing industry and other It simply didn’t exist because
there were no available units!
So, with no supply, the value
of rent increased. Same thing
happens with gasoline, eggs,
toilet paper and all other items
when there is a demand and not
enough supply.

A similar study was conducted at Berkeley, with the
same conclusion.

Creates More Problems
When you have a rent
control system, you create a
BLACK MARKET where people purchase and obtain units
to beat the system. It’s called
“under-the-table money” that
well-to-do renters offer managers who have a vacant unit.

Yes, it’s illegal, but these renters need a place to live. Other less fortunate potential renters
are left homeless!
You create an enormous bureaucracy where the rent control commissioners and others try to create programs so that
they can hire and employ their
nephews, cousins, neighbors
and others to do no work, but
pretend to do some work to get
a paycheck from the cities with
these tenant welfare programs!
industries. Today, there are approximately 23,000 units left after rent control. Los Angeles had 1,600,000 rental units; and today there are less than
600,000. You can evaluate every community and discover that oppressive rent control encourages the owners to sell to developers and units are lost.

In Santa Monica, there was
a substantially large Latino/
Hispanic/Mexican population, and a very large AfricanAmerican community. Today, you can count on one hand
the number of minority citizens still living in these beach towns!
Stanford Study
Stanford University conducted a survey on rent control two years ago and discovered
that the entire city of San Francisco suffered because tenants held onto their units due to the
incredible discounts they were
paying for rent. There was no
turnover. No units available,
and to that extent, the rent control caused businesses to terminate.

You could not find inexpensive housing in San Francisco.

Apartment Owners Association is also Online...
www.AOAUSA.com

AOA News and Buyers Guide • East Bay / San Francisco • May 2023 • (510) 769-7521 • (415) 632-4662 37 Conclusion
So, certainly California and
Oregon, which have comprehensive rent control laws, do not need Federal intervention.

Two years ago, Minneapolis adopted a rent control protocol, and after a single year, it was discovered that no building permits were issued for the construction of residential
income units. None. The rent
control ordinance was immediately rescinded and repealed.

If you want to help, immediately revise the Section 8
program (that is currently so
despicable) so that the vouchers are readily available and the rental arrangement will
be equal to prevailing market
rates and the annual rental adjustment will be equal to an increase formula other than
CPI. Tenants will pay for water, sewage and trash and one half the cost of any mandatory
health protocols.

The inflationary spiral suggests that essential housing services and materials are probably costing us an increase of 18% per year, and cities like
West Hollywood, Santa Monica and Los Angeles capped
increases for owners at 3%!
Does that seem fair or is it just
plain stupid to ignore the fact
that “tenant welfare” (rent control) caused good people to be homeless?
Michael Millman is an Attorney and a Mar Vista activist and can be reached at (310) 477-1201.

AOA: In addition, we
wish all local elected representatives would wake up
and realize that any form of
rent control and/or moratoriums cause housing shortages and exacerbate our homeless
problems. A study of “supply
and demand” will prove it to
you no matter how liberal or
conservative you might be!
Government controls and interference with the free market destroys housing! Science proves it. Basic college courses in Economics teach it
and politicians buy votes by
ignoring it.

Please make a copy of
this letter and send it to your
favorite elected representatives. Please do not sit there and just read – do your part!
Thank you!
To find elected officials in
your area, go to https://myreps.
datamade.us or https://www.
sos.ca.gov/elections/who-aremy-representatives.

To support the fight against
this tenant welfare, please send
your donations to the AOA
Political Action Committee at
6445 Sepulveda Blvd., Suite
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vacant apartments and to destroy protections under Costa Hawkins. It’s going to cost our
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once again defeat their attempt
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From: Jean Claude (JJ) B. Mallein Jr. <[email protected]> Sent: Tuesday, October 10, 2023 4:09 PM
To: City Clerk <[email protected]>
Subject: Residential Rent Stabilization
Good Evening Mayor, Councilmembers and Staff,
I am a Concord housing provider involved with the ownership of 46 units.

I’m sure you have heard before that the Council should focus on the “bad apples” instead of penalizing all Concord hosing providers and stakeholders. Despite being able to raise rents in the 8-9% range this year, we chose to selectively raise rents at 5%, and I believe that this was the case for most housing providers. We want to keep our units occupied and avoid the cost and expense of vacancies, so we already balance this into any rent increase decisions as responsible and fair housing providers. The current proposed rent stabilization will be absolutely debilitating to the vast majority of Concord housing providers that are individual and mom and pop owners and represents an extreme, one-side policy in favor of Concord tenants and tenant activist organizations (and most likely a small portion of actual Concord tenants). I am imploring you to consider a more moderate policy for rent stabilization that balances the interests of both Concord tenants and housing providers while ensuring that City of Concord and it’s staff are not overwhelmed with administrative claims, appeals and general oversight matters which the current proposed policy will inevitable force.

Specifically, AB 1482 provides an effective rent increase cap of 5%-10% (the latter being substantially impossible to reach based on historical CPIs with the current maximum at 9.2%) and the currently proposed policy will provides an effective rent increase cap of 0%-2.42% (CPI has gone negative and tenths of percents). I have researched the historical CPI from 1970 to current, and here’s a breakdown of CPI along with 60% of the average and median over various terms:

CPI Analysis from 1970 to 2023
Average 60% of Average Median 60% of Median
ALL-Average 4.03% 2.42% 3.20% 1.92%
5-Average 3.94% 2.36% 4.00% 2.40%
10-Average 2.72% 1.63% 1.95% 1.17%
15-Average 2.35% 1.41% 1.80% 1.08%
20-Average 2.56% 1.54% 2.25% 1.35%
Even in 2022, when the CPI reached 8%, 60% of 8% is only 4.8%, which is well below many of the operational and utility expense increases we see year-over-year. Based on this information, we have an extreme policy of 0%-2.42% or a “do nothing” policy under AB 1482 of 5%-9.2%. I respectfully request that you consider a moderate policy by selecting a formula/cap in between. If the rent cap formula is too low, then a minimum rent increase should be allowed to ensure some reasonable rate of return for housing providers. Inevitably, property expenses will vary from year-to-year, but as history has shown they will continue to increase. From 2021 to 2022, here’s a breakdown of our property expense increases • Insurance increase 29%
• Repair costs increased 20%
• Utilities increased 20.5% (

o Water increased 62.4%
o Garbage increased 8.61%
• Property Taxes increased 22.6% (2% increase on assessed value) This is a typical year-over-year change, and we have already had the same increase this year. With these expense increases, how can anyone stay in business let alone make a reasonable return when expense increases will be dwarfing rent increases year-over-year. As a housing provider in Concord, we are still recovering from our losses during Covid and higher than average vacancies. Moreover, wages continue to increase year-over-year, but since other expenses are not capped, housing providers are the ones being penalized and forced to subsidize the current economic conditions facing everyone, not just Concord tenants. The current proposed policy will, with certainty, require substantially every landlord to file a reasonable return petition, which will be detrimental to the City of Concord and it’s staff. In reviewing rent stabilization policies throughout the Bay Area, I encourage you to review Hayward’s policy, which seems to strike a fair balance with renters and housing providers.

I also request that you include rent banking, so housing providers have flexibility to raise rents. Without rent banking, all housing providers will be required to raise rents to the maximum annually or risk losing the increase in the future. This will inevitable do more harm than good for tenants, so rent banking a good policy consideration for everyone.

Lastly, retroactively enforcing any adopted rent caps place a substantial, if not impossible, burden solely on landlords, and the City of Concord’s staff even opined that there will be enforcement issues. If a more moderate rent cap policy is adopted, then retroactive enforcement will pose less of an issue to most housing providers.

Thank you for your time and consideration.

JJ Mallein
Warning: This email, including any attachments, may contain confidential or privileged information and is only intended for the person to whom it is addressed. If you have received this email in error, please do not retain, read, copy or disseminate any part of it and delete it from your computer. Please also notify the sender immediately by return message.

From: Diana Fox <[email protected]>
Sent: Tuesday, October 10, 2023 4:45 PM
To: City Clerk <[email protected]>
Subject: Request to City Clerk
Importance: High
Please forward to the City Council our strong objections to the Residential Rent Stabilization Ordinance under current consideration. There are State regulations currently in place and for the City to adopt their ordinance is onerous to all apartment owners and would impair their ability to maintain their properties in a condition they are proud to own and the City would be proud to have as a part of their community.

Thank you for your consideration
Diana Fox
Vice President
Property Management
Davidon Homes/
DH Apartment Homes
1600 S. Main Street Suite 150
Walnut Creek, CA 94596
(925)-945-8000 x 120
[email protected]

From: Cindy Lynds <[email protected]>
Sent: Tuesday, October 10, 2023 5:53 PM
To: Hoffmeister, Laura <[email protected]>; Obringer, Carlyn <[email protected]>; [email protected]; Birsan, Edi <[email protected]>; Nakamura, Laura <[email protected]>; City Clerk <[email protected]>
Subject: Concord City Council Rent Control Zoom Meeting - Landlord Concerns Good evening:

I represent the Owner of an apartment project in Concord, with 89 units. We are very interested in what is happening with rent control. We have been very slow to recover after COVID at this property. Beyond the normal concerns with Rent Control and how it affects the future of an investment, we still have a significant ongoing problem with delinquency of almost $100k. We have a long list of residents who are still not paying, are on payment plans or are waiting to be evicted. Landlords have had to become Lenders, as we work with residents to pay very large past due balances.

The courts are taking a very long time, which results in residents living rent free for as much as an additional 6-12 months after being served eviction notices. As you must know, we cannot properly run a property, providing services, security, amenities, etc. . . when we have such a large non-paying percentage of our property. In addition, our payroll expenses have increased significantly since COVID, as qualified personnel are very hard to find. We are currently having to lower rates in order to secure leases due to the stagnating market. Now is not the time to enact Rent Control. Landlords have not been given near as much consideration as residents/tenants throughout COVID. While residents could have received rent relief, EDD payments, PPP small business loan forgiveness etc. . ., Landlords were still expected to pay property taxes, mortgages, vendors, and keep the property safe and in good repair. Many properties have NOT recovered to a large degree even though the Eviction moratorium was lifted some time ago. Nothing really happened after the moratorium was lifted, since the courts have been backed up.

Given all of what I outlined above, I urge you to not move forward with enacting Rent Control in Concord, at least until the market is fully recovered (both landlords and residents). Moving forward will significantly impact the willingness of investors and owners to invest in Concord and it could even result in a withdrawal of investments.

I respectfully ask for your consideration.

Thank you,
Cindy Lynds
1850 Mt. Diablo Blvd, Suite 410, Walnut Creek CA 94596
Office: 925-256-9448| Cell: 510-333-2158 | Fax: 925-378-7439 [email protected] | www.bridgepartners.com

From: Stephanie Bergin <[email protected]>
Sent: Tuesday, October 10, 2023 6:00 PM
To: City Clerk <[email protected]>
Subject: Concord Rent Control, Just Cause Eviction Workshop Good afternoon city clerk of Concord,
I am contacting you regarding the city council rent control and just cause eviction workshop.

My parents have owned rental property in Concord for the past 30 years. They are both immigrants and have created a business through rental properties. I understand the council exploring rent control options and don't disagree with rent control but feel Concord city council really needs to consider who they are impacting if they pass this ordinance.

AB 1482 is a well crafted rent control bill. It covers renters and stops huge turnover and large rent hikes.

The city of Concord implementing a 3% rent raise cap is going to impact everyone. Landlords will have to ask top dollar because the council is essentially capping their earnings without taking into account the operating costs. This year the insurance for an 8 unit building went up over 60%, not to mention the cost of labor and materials for regular repairs.

My parents primarily rent to low income, single, people of color. They accept all subsidies and really try to keep people housed. Restricting their income is going to make their renting criteria much more stringent, excluding people who really are in need of housing. Landlords won't be able to take a risk on someone because these stringent rent control measures mean their income margins are severely capped.

From what I've learned speaking to community members and renters, there are 2 large housing/apartment complexes owned by corporations that have really taken advantage of their tenants.

Why is everyone assumed to be doing the same? Is there a way you can implement something for corporations that have much deeper pockets than the family owned, mom and pop rental owners.

Maybe a 3% rent cap for corporations and a 6% for private small landlords? Just cause evictions/retaliations - I ask you to consider looking at the Alameda rent board system. They mediate between tenant and landlord to resolve issues and what is termed /retaliation. Can Concord set this up? As it's explained right now, the landlord is assumed guilty but the tenants are not held accountable? What happens if a tenant, which they have, threatens my father? Can we hold consistently misbehaving tenants accountable for their bad behavior? Mostly I'm asking that you as a council member work for the benefit of both sides and work on the basis of what's reasonable when considering these measures.

I welcome the opportunity to meet face to face with you to discuss this further Many thanks for your time and consideration
Stephanie Bergin

From: Julie Krommenhoek <[email protected]> Sent: Tuesday, October 10, 2023 6:00 PM
To: Hoffmeister, Laura <[email protected]>; Obringer, Carlyn <[email protected]>; Aliano, Dominic <[email protected]>; Birsan, Edi <[email protected]>; Nakamura, Laura <[email protected]>; City Clerk <[email protected]>
Subject: Concord Rent Control Will Hurt the City of Concord Dear Concord CIty Council,
I understand your concerns and your desire to keep rent affordable in Concord. We desire the same thing. We have no interest in pricing out our current tenants. However:

1. We will not be able to maintain the buildings to the standard you and we would like to for that low of an increase in this market.

2. You are seriously risking the quality of life in Concord by limiting increases below CPI. We already can barely cover costs to keep properties safe and clean and you are now asking us to do with less.

3. We haven't fully recovered from Covid. We have huge losses and back bills to pay from years of tenants not paying rent on units the government didn't cover and we can only recover a portion of as consumer debt.

4. It is a mistake to limit all rent and lose quality tenants and neighbors. Require some affordable units if you must for people who truly need it, but also allow us to cater to the residents that want a higher quality of life, will spend money in your retail shops, and keep your tax dollars high and your streets clean.

Please don't force property owners out of the rental business.

Julie Krommenhoek Director

PTLA PROPERTY MANAGEMENT
T 510-352-6310 x2104 C 510-969-0089
ptlamgmt.com

From: Lisa Carbajal <[email protected]>
Sent: Tuesday, October 10, 2023 5:44 PM
To: Hoffmeister, Laura <[email protected]>; Marty Carbajal <[email protected]>
Subject: small business owner against rent control
https://www.bloomberg.com/view/articles/2018-01-18/yup-rent-control-does-more-harm-thangood?utm_source=website&utm_medium=share&utm_campaign=email https://www.forbes.com/sites/brendarichardson/2023/03/23/national-apartment-association-studyfinds-that-rent-control-is-not-the-solution-it-appears-to-be/amp/ https://freakonomics.com/podcast/why-rent-control-doesnt-work/ https://apnews.com/article/caribbean-mexico-city-business-050ef97bc5255b4339d31fed39ed14a0 Dear Mayor,
By some estimates, California was 3.5 million housing units short of what we needed to accommodate a population of our size. So even though we are building more housing now, and losing population, we still have a lot of indications that we do have a housing crisis and we do have a housing shortage.

If you can please read any of the articles I have included in this email you will know I do not stand for rent control. The studies show, we will be worsening the housing conditions of this housing sector over time. I know that local governments are entirely taking it out on landlords when in fact no one has done anything in the last 20 years to make enough affordable housing and small business owners are picking up the tab and shown off like a scarlet letter to lower cost and support lower income housing instead of just housing. The fees are being paid, the taxes are being paid, improvements are being made and laws are abided by. Where are the housing developments going up by the City, the State or Federal Government to provide the housing we need here in California.

The housing crisis in California has been a pressing issue for years. According to a study by the non-profit group Up For Growth, the nation’s shortfall of homes reached 3.8 million in 2019, more than double 2012’s tally of 1.7 million “missing” homes. California had the nation’s biggest shortfall in 2019, with a shortage of 978,000 homes 1.

The high cost of living in California has made it difficult for many people to find affordable housing that meets their needs. The median statewide price of a

single-family home was over half a million dollars in 2017 and would crack an astounding $700,000 by 2020 2. This has led to a rise in homelessness and long commutes, which emit more harmful greenhouse gas emissions into the atmosphere 3.

There are many factors contributing to the housing crisis in California, including zoning laws, building codes, and environmental regulations. The state government has implemented several policies to address the issue, such as increasing funding for affordable housing and streamlining the approval process for new developments 23.

However, there is still much work to be done to ensure that all Californians have access to safe and affordable housing.

After reading many articles I understand that we are not doing anything to better the lack of low-income housing rent control and rent control fees are short term money grabs for years of denial I do not want to be responsible or part of turning Concord California into a city that’s has no hope one that’s on a downward spiral.

Not only that but where is the department of health and welfare? Where are the people who are supposed to get people together so they can have the proper documentation to even apply for a proper wage-earning jobs and licensing? How is this a small business issue taxpayers business issue? We are not setting the cost in California the cost is set by statistics in the area.

The results of rent control will show in five to ten years when the housing stock and the quality remaining will deteriorate. If Concord will take a moment an emulate cities like Walnut Creek, Pleasant Hill, Lafayette instead of identifying with cities such as Oakland, Richmond and Vallejo other proposals will be at hand.

There is currently a real dichotomy in Concord city government, on the one hand supporting successful developments like Veranda and the newly built apartments homes downtown which will bring tax dollars to the city coffer and on the other hand trying to institute rent controls that first -year economic student will testify as futile. They will only serve the few in detriment to the many, this controls will reduce investment in modest housing and will cause lowering of income, standards, and urban blight.

I do not understand how after reading the results of rent control some sectors in government are still in favor of rent control other than it is to pander to populist

measures that will cause significant problems down the road. Furthermore, to not see how threatening landlords with the harshest rent controls. I have been receiving so many phone calls about retro-activating the rent to January 2023 even when we had just been supporting and working with all our tenants during Covid. We supplied housing and the people are till there today. Before after and during.

Concord wanting the landlords to pay the highest relocation fees. The threats when pointed at you the law-abiding citizen and businessowner are not so fun and even scary at times. The continuing harassment of higher fees more departments from city organizations with more fees as cost of inflation, rebuilding, insurance, wages & labor continue to escalate for everyone here California.

Please put our city first.

Lisa Carbajal and Marty Carbajal
Small business owners
Concord CA.

Housing prices to personal income ratios by metro
area
Los Angeles
San Jose
Denver
New York
Seattle
Boston
United States average
Dallas
Chicago
Detroit
A tent city, a form of improvised
housing, in Oakland, California
California housing shortage
Since about 1970, California has been experiencing an
extended and increasing housing shortage,[1]:3
such
that by 2018, California ranked 49th among the states
of the U.S. in terms of housing units per
resident.[2]:1[3] This shortage has been estimated to be 3-4 million housing units (20-30% of California's
housing stock, 14 million[4]) as of 2017.
[5] Experts say
that California needs to double its current rate of
housing production (85,000 units per year) to keep up
with expected population growth and prevent prices
from further increasing, and needs to quadruple the
current rate of housing production over the next seven
years in order for prices and rents to decline.[6]
The imbalance between supply and demand[7] resulted
from strong economic growth creating hundreds of
thousands of new jobs (which increases demand for
housing) and insufficient construction of enough new
housing units to meet demand. From 2012 to 2017
statewide, for every five new residents, one new
housing unit was constructed. In California's coastal urban areas, (where the majority of job growth has occurred since the Great Recession), the disparity is greater: in the Bay Area, seven times as many jobs were created as housing units. By 2017, this resulted in the median price of a California home being over 2.5 times the median U.S. price. As a result, less than a third of Californians can afford a median priced home (nationally, slightly more than half can), 6 percent more residents are in poverty than would be with average housing costs (20% vs. 14%), homelessness per capita is the third highest in the nation, the state's economy is suppressed by $150–400 billion annually (5-14%) (because of lost construction activity, and money that must be spent on housing cannot be spent on other consumer goods), and the long commutes caused by unaffordable housing in the urban centers where jobs are is hindering California's ability to meet its CO2 emissions goals.[8] Several factors have together caused constraints on the construction of new housing: density restrictions (e.g. single-family zoning) and high land cost conspire to keep land and housing prices high; community involvement in the permitting process allows current residents who oppose new construction (often referred to as NIMBYs) to lobby their city council to deny new development; environmental laws are often abused by local residents and others to block or gain concessions from new development (making it more costly or too expensive to be profitable); greater local tax revenues from hotels, commercial, and retail development vs. residential incentivize cities to permit less residential; and construction costs are greater because of high impact fees, and often developments are only approved if union labor is used.[9]

Median home prices for California and for the United States since 1940, in 2022 dollars[13][14][15] New residents per new home by decade since 1940[16][17][18] In 2016, the Obama Administration recommended that cities across the nation with high housing costs reform their land use regulations to enable opportunity for people at all income levels to access jobs being created in growing cities.[10] Since then, the California legislature has passed several bills: some reduced the fees and bureaucracy involved in creating ADUs, while others have added fees to real-estate document recording to finance low-income housing; yet even the most optimistic projections find that relative to the scope of the problem, these will have minimal effect. In addition, proposed bills that would have legalized higher density development close to public transit failed in the legislature.[11] In 2019, the Council of Economic Advisers estimated that deregulating the housing market would lead to rents falling by 55 percent in San Francisco, 40 percent in Los Angeles, and 40 percent in San Diego.[12]:11,15 Issi Romem, an economist at the Terner
Center for Housing Innovation at the
University of California, Berkeley said:
"...as long as abundant new housing was built to accommodate those drawn to California, housing price growth was limited and the state's allure was channeled into population growth:

From 1940 to 1970 California's population grew 242 percent faster than the national pace, while the growth of its median home value was only 16 percent faster than the nation's."[19] Starting in 1970, three major forces caused housing prices to increase dramatically: land use restrictions limiting housing density (zoning many areas to single-family homes, or to at most two stories), increased concern for the environment (which led to environmental laws and designating land for preservation and not development), and community involvement in the development process (which allows current—but not future—residents a say in land use decisions.)[19]:1
The result of these policies was that from 1970 to 2016, California's population growth (relative to the US average) slowed to a third of what it was during the previous three decades (70 percent faster than the national pace by 2016), while appreciation of median home prices (relative to the US average) more than quadrupled to 80 percent greater than the national rate.[19]:1 [1]:3 By 2016, the median price of a home in California, at $409,300, was more than twice the median price of a home in the U.S. as a whole, more expensive than any state other than Hawaii.[20] The shortage is statewide; from 2010 to 2017, the state added one new housing unit for every five new residents, and is pronounced in employment centers such as the Bay Area and Los Angeles.[21]:1 [22] In 2023, housing affordability in California reached a 16-year low, with only about 16% of homebuyers able to purchase a median-priced single-family home, as per data from the California Association of Realtors. In San Mateo and Santa Clara counties, buyers would require a minimum income of $504,400 and $451,200, respectively, to purchase median-priced homes of $2.01 million and $1.8 million.[23][24] The housing situation affects individuals differently, depending upon their circumstances. A person who has long since paid off a home mortgage has much lower costs than a renter or someone buying a first home.

As of 2020, about 20 percent of California homeowners owned their homes free and clear, and 80 percent were still paying a mortgage.[25] As is typical, homeowners without a mortgage tend to have lower incomes Background

(e.g., due to retirement) than homeowners with a mortgage.[25] California homeowners without a mortgage tend to spend almost 9% of their income on housing costs, including property taxes, which is slightly lower than the national average for homeowners without a mortgage.[25] The imbalance between supply and demand;
[26]:1[2]:1 [1]:3[27]:1[28]:2[29]:1
resulted from of strong
economic growth creating hundreds of thousands of new jobs (which increases demand for housing) and the insufficient construction of new housing units to provide enough supply to meet the demand.[30]:1[31]:1[32]:1[33][1]:14,17 [34]:1
Fewer housing units built in the urban and coastal areas relative to the demand created by economic growth in those areas resulted in higher prices for housing and spillover to the inland areas.[1]:3
For example, from 2012 to 2017, San Francisco Bay area cities added 400,000 new jobs, but only issued 60,000 permits for new housing units.[35]:1[29]:1[36]:1 (For California as a whole,
from 2011 to 2016, the state added only one new housing unit for every five new residents.)[21]:1 This has driven home prices and rents to high levels, such that by 2017, the median price of a home across California was more than 2.5 times the median in the U.S. as a whole, and in California's coastal urban areas, (where the majority of job growth has occurred since the Great Recession), the shortages are greater.

Several factors have together caused constraints on the construction of new housing.

NIMBY ("Not In My Back Yard") resistance by existing residents to new development is a major contributor to the difficulty of developing new housing in the state.[37]:1[38]:1 People who already live in an area often perceive any new development or change as driving increased negative traffic and population impacts.[39]:1
Using various means (political pressure, protests, and voting power), NIMBYs try to keep newcomers out by defeating development projects in the local government permitting process, or slowing them down to the point that they become uneconomical for the builders.[1]:15[40][38]:1 "Localism" (a seemingly egalitarian belief that incumbent residents have the moral authority to define what their community will look like) has been found to instead result in imbalances which favor white, affluent homeowners, and suggest that localism is more prevalent in planning practice than in the general population.[41] On this issue, New York Times opinion writer Farhad Manjoo stated: "What Republicans want to do with I.C.E. and border walls, wealthy progressive Democrats are doing with zoning and Nimbyism. Preserving "local character," maintaining "local control," keeping housing scarce and inaccessible — the goals of both sides are really the same: to keep people out."[42] In 2022, California governor Gavin Newsom declared that "NIMBYism is destroying the state" and promised to hold cities and counties accountable for stopping new housing development.[43] Environmental laws—primarily the California Environmental Quality Act (CEQA)—can be a hurdle to housing development.[44]:1[45] CEQA requires the permitting agency, usually a local government, to review each new project in accordance with CEQA to provide a full disclosure of the project's impacts to the approval body (usually a planning commission or city council) and the public. Individual single-family homes are exempt, as well as some smaller multi-family projects, but most mid-size and larger projects must go through a Negative Declaration or EIR to provide the required level of disclosure of project impacts.

The EIR process requires the developer to conduct studies and provide a report on a wide variety of Causes
Community resistance (NIMBYism)
Environmental laws

impacts including traffic congestion, wildfire evacuation, fire safety, noise, air pollution, greenhouse gas emissions, water pollution, biological resources, cultural resources and infrastructure impacts and develop a plan to help mitigate any impacts if any exist. The CEQA process is intended to make the approval process transparent to the public and decision-makers and takes place prior to a local government acting to permit a new development. Additionally, CEQA allows for legal challenges against the CEQA review process itself which may result in lawsuits by those who oppose the project and find the developer did not properly study the impacts from a project prior to the local government approving the project. Litigation is the main enforcement mechanism by which CEQA violations are mitigated.[1]:15[46]:1 A report by the California
Legislative Analyst's Office found that in the state's 10 largest cities, CEQA appeals delayed projects by an average of two and a half years. [47]:8 [38]:1
A 2015 study by Jennifer Hernandez and others at the environmental and land-use law firm Holland & Knight,[48]:21 looking at all CEQA lawsuits filed during the three-year period 2010–2012, found that less than 15% were filed by groups with prior records of environmental advocacy.[49]:1[48]:24 This study also found that four of five CEQA lawsuits targeted infill development projects; only 20 percent of CEQA lawsuits were targeted at "greenfield" projects that would develop open space.[49]:1 Carol Galante, a professor of Affordable Housing and Urban Policy at the Terner Center for Housing Innovation at UC Berkeley, who served in the Obama Administration as the Assistant Secretary at the U.S.

Department of Housing and Urban Development (HUD),[50]:1 stated that "It (CEQA) has been abused in
this state for 30 years by people who use it when it has nothing to do with an environmental reason, ...

NIMBY-ism is connected to the fact that for everyone who owns their little piece of the dream, there's no reason to want development next door to them, CEQA gives them a tool to effectuate their interest ... We need to fundamentally rethink how the CEQA process works in this state."[51]:1 [44]:1 In an interview with UCLA's Blueprint magazine, Governor Jerry Brown commented on the use of CEQA for other than environmental reasons: "But it's easier to build in Texas. It is. And maybe we could change that. But you know what? The trouble is the political climate, that's just kind of where we are. Very hard to — you can't change CEQA [the California Environmental Quality Act]. BP: Why not? JB: The unions won't let you because they use it as a hammer to get project labor agreements."[52][53]:1 While CEQA's original intent must remain intact, now is the time to end reckless abuses of this important law – abuses that are threatening California's economic vitality, costing jobs and wasting valuable taxpayer dollars. ... Today, CEQA is too often abused by those seeking to gain a competitive edge, to leverage concessions from a project or by neighbors who simply don't want any new growth in their community – no matter how worthy or environmentally beneficial a project may be. - Former Governors George Deukmejian, Pete Wilson, and Gray Davis in a 2013 editorial in The Sacramento Bee[54]:1
A CEQA study (commissioned by the Rose Foundation,
[55]:2
an environmental advocacy group) done by
BAE Urban Economics, estimated that 0.7% of all CEQA projects with review documents had been subject to litigation, for the years 2013–2015.[55]:22 In San Francisco, the attorney general's office, during an 18-month audit of CEQA in 2012, found that 0.3% of (non-exempt) CEQA projects were subject to lawsuits.[56]
Tax structures

Partially because Proposition 13 limits the property tax that local and state governments can collect, cities are incentivized to permit commercial development rather than residential development.[57] Commercial development can potentially yield both sales tax revenue (car dealerships and shopping malls are examples of favored development due to their density of revenue), as well as business tax revenue (many cities levy either a payroll tax or a gross-receipts tax on all businesses located within their boundaries).[47]:7 Residential development is typically seen as a net loss to a city's budget due to costs associated with service delivery (public safety, roads, parks, etc.) to residents exceeding the tax revenue received from those residents.[1]:15 For example, the city of Brisbane, when considering developing a greenfield (Brisbane Baylands development), was told that a housing-heavy development would bring in $1 million annually in additional income for the town, but a commercial development with no housing and a larger hotel would bring in $9 million annually—and that without building hotels, the development would be a net loss to the city budget.[58][59]
High land cost and low-density development with very small increases in housing density, which in turn keep land prices high.[1]:12 The Sacramento Bee notes that residential land prices are more than 600% greater in coastal California than the average of America's other large metropolitan areas.[60] With quasi-judicial authority over zoning on the coastline and up to 5-mile inland (8.0 km), the California Coastal Commission has been an added hurdle for citizens and cities seeking to build housing. The commission was formed over opposition to the Sea Ranch development preventing access to the beach.

Specific housing developments opposed by the Commission include 895 homes in Orange County,[61] 50 homes for the disabled in Half Moon Bay,[62] and 400 apartment units in Ventura County.[63] The Commission sets fees and fines for permit violations and has levied million-dollar penalties.[64][65][66] It has been called the single most powerful land use authority in the United States given the high values of its jurisdiction and its vast environmental assets, and that, because its members are appointed by the governor and the State Senate and Assembly leaders which have generally been Democrats, the Commission reflects a constituency that is important to Democrats.
[67] Some research has examined its effects in particular:

UCLA researchers documented that quality-adjusted homes inside the commission's jurisdiction were 20% more expensive than those just outside it because of restrictions on housing supply and enhancements to natural amenities that increase demand.[68] A UCSB research paper found that the Commission increased housing prices by restricting supply thereby "harming renters, future home buyers, and owners of undeveloped land," but existing homeowners in the commission's jurisdiction were beneficiaries of home price increases.[69]
The state levies higher development fees for building a single-family home than in the rest of the country on average.[70] The California Legislative Analyst's Office reported it to be 266% greater, $22k vs. $6k.[1]:14 For example, the developer planning to redevelop the site of a former Naval Hospital in Oakland with a residential community of 935 homes will be paying $20M (= $21k / home) in fees to the City of Oakland's affordable housing fund.[71]
High land cost and low density
Coastal Commission
Construction costs

Median housing price by metro area
Median rent by metro area
Housing Affordability Index for California and Santa Clara County since 1991[75] Labor costs are higher because of prevailing wage laws and that some projects are only approved if union labor is used. This was estimated at 20% more by the California LAO.[1]:13[72][73] The contribution of prevailing wage requirements to total construction cost has been estimated to be as large as a 40 percent increase.[74]:1
Material costs are higher due to building codes and standards requiring better quality materials and higher energy efficiency.[1]:13
This shortage has driven home prices and rents to
extremely high levels.[76] In 2017, the median price of a home in California was more than 2.5 times the
median in the U.S. as a whole, and in California's
coastal urban areas, the shortage was greater than the
inland areas, as demonstrated by the median prices of
homes in those respective markets: $1.3M in San
Francisco, $1M in San Jose, and $600k in Los
Angeles, while only $250k in Fresno.[77][78][79] In the rental market, California now has the lowest vacancy
rate the state has ever seen, at 3.6%;[80] and while the median rent throughout the state for a two-bedroom
apartment is $2,400, the median rent in coastal urban
areas is even higher, surpassing $4,000 per month in
San Francisco.[81]:1
In 2023, the housing market in San Diego shows that
nearly 60% of homes have listing prices above $1
million. The median home
price in the city is $910,000,
making it the fourth highest
among the 30 largest U.S.
cities.[82][83] The average monthly rent in San Diego has risen to $3,175, placing it as the third-highest in the nation, only $7 less than that of San Francisco.[84] Housing affordability has declined over the last three decades; as of 2018, less than a third of Californians could afford a median-priced home; in job centers such as the San Francisco Bay Area, that number is less than a quarter. (Nationally, more than half of American households can afford the median-priced American home.)[75] Housing unaffordability also leads to crowding, defined as more than one adult per room of a dwelling (counting two children as one adult). Californians are four times as likely to live in crowded housing as the average American, and this holds across every type of housing—renters, owners, those with and without children.[1]:29-31
Effects
Affordability

When comparing the rental rates of Los Angeles and the average rate across the United States one can see just how much higher the city is compared to the rest of the country. While in 2017 the average rental rate in the United States was $1,357, in comparison the average rental rate in Los Angeles in 2017 was $2,284, almost a $1,000 average increase.

As a result, workers have moved to more affordable inland locations which requires longer commutes. As of 2018, the three cities in the United States with the largest share of super commuters—workers spending an hour and a half or more each way to get to and from their jobs—are Stockton, Modesto and Riverside.
[85][86]:1
Workers have been displaced outside of the state as well; from 2007 to 2016, California saw net out-migration among all groups making under $110,000 a year, largely to Sun Belt states like Arizona, Nevada and Texas.
[87]
Longer commutes and increased traffic caused by suburban sprawl due to housing shortages concentrated in job centers increase greenhouse gas emissions. Because of California's mild climate and heavily renewable energy mix, transportation is the largest category of emissions in the state.[88] When Californians emigrate to states with higher per-capita greenhouse gas emissions, they drive more, consume more energy for air conditioning, and use more fossil fuel-dependent electricity generation.[89] Scarce, low-density housing is directly at odds with California's climate goals.[90]:1[91] "You can't be pro-environment and anti-housing, ... You can't be anti-sprawl and anti-housing.

This is something that has not been very well understood." - Marlon Boarnet, chair of the Department of Urban Planning and Spatial Analysis at USC. [91]
Scientists at the Renewable and Appropriate Energy Laboratory at the University of California, Berkeley recently found that infill development, that is utilizing existing vacant urban structures for future housing or commercial use, has the potential to reduce CO2
emissions; more so than any other option. Simply put,
creating a denser housing structure limits the amount of travel time from work to home and back, thus limiting CO2 emissions drastically. At governor Gavin Newsom's first legislative session, he pledged to make the housing crisis one of his top priorities. One such solution is the More Homes Act, which overrides restrictive zoning requirements by implementing small to midsize apartment buildings near major job and transit centers.[92][93][94]
When the cost of housing is factored into the poverty rate, as the Census Bureau now does in its releases of the "Supplemental Poverty Measure,"[95] California's poverty rate lists as the highest in the nation, (and has since 2011, when the Census Bureau first started releasing poverty by this measure) currently at 20.4%, or just over 1 in 5 people.[96]:1[97] The Public Policy Institute of California estimates that if the housing costs in California matched those for the nation overall, California's poverty rate would instead be 14 percent.[96]:1
Displacement and environmental impact
Poverty
Homelessness

A homeless person sleeps on the
sidewalk next to a limousine in the
Mission area of San Francisco.

Persons per housing unit for California and for the United States since 1940[16][18][17] California in 2017 is home to an oversized share of the nation's homeless: 22%, for a state whose residents only make up 12% of the country's total population.[28]:1[98] The Sacramento Bee notes that large cities like Los Angeles and San Francisco both attribute their increases in homeless to the housing shortage.[98][99]:1 Homeless persons in California now number 135,000 (a 15% increase from 2015).[80]
A study by the California Housing Partnership found that from 2016 to 2017 homelessness increased by 47 percent in Sacramento County (home to the state's capital, Sacramento), 36 percent in Alameda County, and 13 percent in Santa Clara County.[21]:1 Nationwide, California ranks third for the most homeless persons per capita, behind New York and Hawaii.[100][99]
In September 2019, the Trump Administration's Council of Economic Advisers released a report in which they stated that deregulation of the housing markets would reduce homelessness in some of the most constrained markets by estimates of 54 percent in San Francisco, 40 percent in Los Angeles,[12]:1 and 38
percent in San Diego, because rents would fall by 55%, 41%, and 39% respectively.[12]:14,16 A 2017 study[101] by Nobel Laureate in economics Edward Prescott, Lee Ohanian (senior fellow at the Hoover Institution), and Kyle Herkenhoff, estimates that if California were to roll back its land use regulations to where they stood in 1980, the state's GDP could permanently increase by almost $400 billion (a 14% increase).[33] "If every state rolled back land regulations to 1980 levels, [total US] GDP could rise by as much as $1.8 trillion [9%]."[33][102]:1
A McKinsey Global Institute report estimates that the housing shortage is costing the California economy between 143 and 233 billion dollars per year, from lost construction activity (at least $85 billion annually), lower consumption of consumer goods because of high housing costs (at least $53 billion annually) and the costs of providing services to the increased number of homeless persons (at least $5 billion per year).[103][104][81]:1[38]:1
The California Legislative Analyst's Office 2015 report "California's High Housing Costs - Causes and Consequences" estimates that for the state to have kept housing prices no more than 80% higher than the median for the U.S. as a whole (the price differential which existed in 1980, as opposed to the >150% differential which exists today), California would have needed to add approximately 210,000 new housing units each year over the past three decades (1980-2010), rather than the 120,000 / year which were built.

Their midpoint estimate of the underbuilding for the last three decades is 90,000 units per year, an estimated shortage of 2.7 million housing units (20%) by 2010.[1]:21 Economy
Quantifying the shortage
Estimated
under-supply of
housing units

Jobs per housing unit for California and for the United States since 1980[16][17][117][118] Since 2010, the state's construction of new housing units has averaged well below 90,000 units per year.[105] It took a drop after the 2008 Great Recession, but has increased to about 90,000 / year in 2016.[105][106]
In September 2017, a team of economists from UCLA Anderson Forecast, led by Jerry Nickelsburg, predicted that "it would take 20 percent more housing to achieve a 10 percent reduction in prices. Such a reduction throughout California would bring costs down roughly to 2014 levels..."[107] In a 2018 UCLA Anderson Forecast report, economist Nickelsburg estimated the shortage at 3 million units.[108]:1 In October 2017, lieutenant governor and gubernatorial candidate Gavin Newsom said that California should set a goal to produce 3.5 million new homes by 2025.[109][103] This would require a quadrupling of the current rate of building to almost 400,000 units per year, a rate the state has not experienced since 1954.[110] [111]:1[112]
In April 2018, state Senator Scott Wiener, author of several bills to reduce the housing shortage, estimated it at 4 million units.[113]
In a 2019 paper, economists Enrico Moretti and Chang-Tai Hsieh analyzed the U.S. housing market and found that if Americans had consistently built housing commensurate with demand, the city of San Francisco would have two million housing units (rather than the 400,000 it has today) and a population of four million people (as opposed to its actual 2022 population of around 815,000), and the greater Bay Area would have five times the population it has today.[114] Experts say that California needs to double its current rate of housing production (85,000 units per year) just to keep up with expected population growth and prevent prices from further increasing, and needs to quadruple the current rate of housing production over the next 7 years in order to for prices and rents to decline.[26]:1[115]:1[103][28][1]:21[30]:1[116]:1
In 2018, California ranked 49th among the United States in housing units per resident.[2]:1 [3] While some people claim that a "healthy" ratio of jobs to housing units is around two, many California metros are far from that, with San Diego at 3.9, Los Angeles at 4.7, and San Francisco at 6.8.[27]:1 Over the decade 2013-2022, California's local governments (who control the home permitting process) approved 2.6 new housing units per 100 residents, significantly lower than the nationwide average of

3.9.[119] The state had the 37th lowest permitting rate in the country, with some states (Idaho and Utah) Increase in housing production needed
Ratio of residents and jobs to housing units
Permitting rate

permitting at more than double California's rate.[119] While California's permitting rate has been increasing, with the rate having increased 20% for the five years 2018-2022 compared to the previous five years, the state's rate still lags the nation as a whole whose 2018-2022 rate was up 33% compared to 2013-2017.[119] In a September 2016 report from the Executive Office of the President of the United States titled "Housing Development Toolkit",[120]:2 [121]:1[122]:1[123]:1[124]:1[102]:1 the authors cited several of California state
and localities' attempted legislative fixes for the housing shortage as models that it recommends other states and localities also follow to abate their housing shortages,[120]:12 including:
establish by-right development,[120]:14
tax vacant land or donate it to non-profit developers,[120]:15 streamline or shorten permitting processes and timelines,[120]:16 eliminate off-street parking requirements,[120]:17
allow accessory dwelling units,[120]:17 and
establish density bonuses.[120]:18
The report also highlighted one of President Obama's remarks to the U.S. Conference of Mayors on January 21, 2016:

We can work together to break down rules that stand in the way of building new housing and that keep families from moving to growing, dynamic cities.

In September 2016, Governor Jerry Brown signed AB 2406, AB 2299, and SB 1069, all of which reduce the cost and bureaucracy needed to construct an ADU (Accessory Dwelling Unit), also known as a "granny flat" or "in-law unit".[125] The Bay Area Council notes that if only 10 percent of the Bay Area's

1.5 million single family homeowners build ADU's, that would create 150,000 units of new housing.[126] This change resulted in dramatic increases in applications for ADU building permits; Los Angeles saw 25 times as many applications in the 2017 calendar year than it did in the previous two years combined.[127]:1 In the 2017 legislative session, a package of 15 housing bills was passed. One bill legalizes microapartments as small as 150 sq. ft. and prohibits cities from limiting their numbers near universities or public transit;[128]:1
another (SB 2) adds a $75 real-estate document recording fee (for everything other than property sales), which is projected to generate $250 million per year for affordable housing construction.[128]:1[129]:1[130]:1
The total 2017 housing package is expected to have only a minimal Responses
Federal
State
2016 Legislative session
2017 Legislative session

impact on the shortage, because even the most optimistic predictions suggest that the measures will increase yearly housing production by about 14,000 units per year, still well short (14%) of the additional 100,000 new units needed yearly (in addition to the 80,000 being produced yearly) just to keep pace with population growth and prevent prices from rising.[38]:1[130]:1[39]:1 Another bill was Senate Bill 35 (SB 35), authored by state Senator Scott Wiener which shortens the approval process by eliminating environmental and planning reviews for new infill housing in cities which have failed to meet their state housing production goals. The state sets goals for production of different types of housing: market-rate, low-income, etc., (to keep up with expected population growth) and this law applies only to development types for which the city is not meeting its production goal. To make use of the streamlined approval process, the developer must pay prevailing wage and abide by union-standard hiring rules.[128]:1[129]:1[130]:1[131][132] Wiener said, "Local control is about how a community achieves its housing goals, not whether it achieves those goals.... SB 35 sets clear and reasonable standards to ensure that all communities are part of the solution by creating housing for our growing population."[131] SB 35 has been used, for example, to redevelop the derelict Vallco Shopping Mall in Cupertino into a mixed-use development containing 2,402 apartments, half of them affordable, with no government subsidies, which will quintuple Cupertino's affordable housing stock.[133]:1[134]:1 [135]:1[136] In 2018, Senator Wiener introduced SB 827, which would have required localities to allow buildings of at least 4 or 8 stories within a half-mile of a high-frequency transit stop, or within a quarter-mile of a bus or transit corridor, as well as waiving minimum parking requirements in those areas.[2]:1 The bill was
controversial, being opposed both by local governments concerned about the loss of local control of zoning, and by anti-gentrification activists concerned about displacement.[137] The bill was supported by a group of scholars who stated that it would help reduce decades of racial and economic residential segregation,[138][139]:1-2[140]:1
as well as pro-housing groups nationally, and by over 100 San Francisco Bay area technology industry executives who voiced their support of the bill in a joint letter.[141] Regarding the issue of local control, Wiener said: "In education and healthcare, the state sets basic standards, and local control exists within those standards. Only in housing has the state abdicated its role.

But housing is a statewide issue, and the approach of pure local control has driven us into the ditch."[39] Anti-displacement provisions were inserted in response to gentrification concerns. It was subsequently defeated in its first committee hearing.[142][143]
In December 2018, Senator Wiener introduced a similar bill for the following legislative session, SB 50, which was defeated in a senate floor vote in 2020.

In September 2021, Governor Gavin Newsom signed a package of 31 housing bills, including the California HOME Act (SB 9) and SB 10.[144] The California HOME Act (SB 9) upzones most of California to allow building denser housing, up to a fourplex, on a lot. SB 10 streamlines the process for Senate Bill 35
2018 Legislative session
Senate Bills 827 and 50
2021 Legislative session

local governments to build dense housing around transit rich areas. Other bills aim to streamline the homebuilding process, reduce barriers to building affordable housing, and hold local governments responsible for building more housing.[145]
Other bills that Governor Newsom signed include SB 290, AB 1584, SB 478, and AB 602.[146] SB 290 expands California's density bonus law to include affordable housing for low income college students.

Density bonuses allow developers to build denser housing, so long as a portion is set aside for affordable housing. AB 1584 makes void any housing covenants that would prohibit the construction of an ADU in certain circumstances.

SB 478 creates a minimum floor area ratio and a minimum lot size for multi-family housing that's between 3 and 10 units. SB 478 also prevents local governments from imposing a lot coverage requirement that would make it impossible for a housing project to achieve its minimum floor area ratio. AB 602 regulates impact fees that local governments can charge on housing. AB 602 makes impact fees more transparent, and requires local governments to make impact fees proportional to the square footage of the house.

In September 2022, Newsom signed a package of housing bills, including AB 2011, SB 6 and AB 2097.[147]
AB 2011 has officially gone into effect as of July 1st, 2023.[148] The policy allows for affordable and mixed-income housing to be built on commercially-zoned property on a ministerial, by-right basis, as long as the projects fulfill affordability and environmental criteria, and pay prevailing wage. [147] Additionally
there is a requirement for the use of apprenticeship programs that are approved by local governments.

When these contracts are being accepted by contractors they will also be provided with health care expenditures.[149] This being a new and more recent Bill studies will be conducted by the Department of Housing and Community Development which will be used to present to legislature on the effects and results of the additional housing developments.

Housing is considered affordable if a household is spending 30% or less of their monthly income toward their rent or mortgage.[150] Affordable housing is housing specifically allocated for individuals earning 80% or less of the area median income (AMI) of the region they reside in, and restrics their rent payment to 30% of their monthly income.[151] Mixed-income housing is defined by Brophy and Smith as "a mix of subsidized and market-rate housing".[152]
Commercially-zoned property under this policy includes, "office, retail, or parking".[153] Developers are able to use AB 2011 to develop residential units on commercially-zoned property without the need for rezoning of a parcel, a lengthy process that can last several months. Additionally, this policy also allows for project exemption from CEQA,
[154] which is beneficial since exemption can expedite the development process exponentially. This is especially crucial for affordable housing developments, as CEQA is often weaponized by NIMBY's to thwart projects from reaching approval.[155] 2022 Legislative session
AB 2011
Important Definitions
AB 2011 Considerations with Affordable Housing

Although this policy will expedite the project approval process, requiring prevailing wage poses a major problem for 100% affordable housing developments (where all units are income restricted). The requirement of prevailing wages leads to complication in financing development, as prevailing wage potentially raises construction costs by up to 40%.[156] This increase creates obstacles for the financial feasibility of affordable housing developments, as affordable housing financing is far more complex than market-rate housing. Funding involves hard loans from banks accompanied by multiple state[157][158] and municipal grants,[159] all of which are difficult to qualify for and obtain as there are many affordable housing developers competing for the same funds. When construction requires an affordable housing developer to pay prevailing wages, it becomes even more strenuous to finance the construction cost increase. This is because receiving funding awards from public subsidies is competitive and affordable housing developments generate a low rental cashflow every year because they charge low rents; hence, they are unable to support a larger loan payment. The requirement of prevailing wage for construction can potentially mean that the development is financially infeasible, and the affordable development may not move forward or may not proceed with approval under AB 2011.

SB 6 allows for residential use on commercially zoned property without requiring a rezoning, as long as a percentage of construction workers hired are unionized.[147] AB 2097 removes parking minimums for homes and commercial properties within one mile of public transit stations or in neighborhoods with low rates of car use.[160] California became the second state after Oregon to eliminate parking minimums near public transit.

Since 2014, several YIMBY (Yes In My Back Yard) groups have been created in the San Francisco Bay Area.
[161][162] These groups lobby both locally and in Sacramento for increased housing production at all price levels, as well as using California's Housing Accountability Act ("the anti-NIMBY law")[161]:1 [162]:1
to sue cities when they attempt to block or downsize housing development.[161] One activist, in a comment to the San Francisco Planning Commission supporting the construction of a new 75-unit mostly market rate housing development stated that: "The 100 or so higher income people, who are not going to live in this project if it isn't built, are going to live somewhere...They will just displace someone somewhere else, because demand doesn't disappear."[163]
As a way to rapidly create inexpensive housing, a Bay-Area startup company converts 8' x 20' shipping containers into homes for as little as $8,000, though due to expensive ($3,000 - $5,000 for a permit) and restrictive zoning in many cities, has found it hard to find locations that will allow the homes.[164] There are over 400,000 deed or use-restricted affordable housing units in California which were built with the provision that they remain affordable for the following decades (generally between 30 and 55 years) in exchange for subsidies.[165] The state's Department of Housing and Community Development (HCD) estimates that there are more than 35,000 units whose affordability requirement will expire by 2021 and that many of these will likely be converted to market rent units. HCD has made the preservation of these units as affordable housing a priority.

Under the federal government's Section 8 voucher system, residents pay 30% of their salary and the Housing Authority pays the difference of the rental cost.[166] As indicated by Metcalf (2018), "In 2015, 2.2 million households, comprising 5 million people, used rental vouchers to secure housing in the private market" though these figures are for the entire United States.[166] Unlike other public assistance programs (such as SNAP or Medicaid) there are only a limited number of Section 8 vouchers, meaning that most SB 6 and AB 2097
Other efforts

people who apply and qualify for the program are not able to participate in the program, and instead are placed on a wait lists for years.[167] The Housing Authority of the City of Los Angeles closed its Section 8 wait list for over a decade due to high demand, and only reopened in 2017.[168] San Francisco housing shortage
Affordable housing in the Silicon Valley
United States housing market correction
Cost of rent by state and county in the United States

1. Taylor, Mac (March 17, 2015). California's High Housing Costs - Causes and Consequences (http://www.lao.ca.gov/reports/2015/finance/housing-costs/housing-costs.pdf) (PDF) (Report). California Legislative Analyst's Office. Archived (https://web.archive.org/web/20150 406005153/http://www.lao.ca.gov/reports/2015/finance/housing-costs/housing-costs.pdf) (PDF) from the original on April 6, 2015. Retrieved October 26, 2017.

2. Roberts, David (February 23, 2018). "A sweeping new bill targets California's housing crisis" (https://www.vox.com/cities-and-urbanism/2018/2/23/17011154/sb827-california-housing-cri sis). Vox Media. Archived (https://web.archive.org/web/20180301144732/https://www.vox.co m/cities-and-urbanism/2018/2/23/17011154/sb827-california-housing-crisis) from the original on March 1, 2018. Retrieved March 1, 2018.

3. "A TOOL KIT TO CLOSE CALIFORNIA'S HOUSING GAP" (https://www.mckinsey.com/~/me dia/McKinsey/Global%20Themes/Urbanization/Closing%20Californias%20housing%20ga p/Closing-Californias-housing-gap-In-Brief.ashx). McKinsey Global Institute. October 1, 2016. Archived (https://web.archive.org/web/20161105022549/https://www.mckinsey.com/~/ media/McKinsey/Global%20Themes/Urbanization/Closing%20Californias%20housing%20 gap/Closing-Californias-housing-gap-In-Brief.ashx) from the original on November 5, 2016.

Retrieved March 1, 2018. "California ranks 49th among the 50 US states for housing units per capita."

4. Annual Estimates of Housing Units for the United States, Regions, Divisions, States, and Counties: April 1, 2010 to July 1, 2017 (https://archive.today/20200213004637/https://factfind er.census.gov/bkmk/table/1.0/en/PEP/2017/PEPANNHU) (Report). United States Census Bureau. July 1, 2017. Archived from the original (https://factfinder.census.gov/bkmk/table/1.0/ en/PEP/2017/PEPANNHU) on February 13, 2020. Retrieved September 20, 2018.

5. See the section on Estimated_under-supply_of_housing_units for additional sources.

6. See the section on Increase in housing production needed for sources.

7. See the section on Causes for the references supporting that "supply and demand" is the fundamental cause of this shortage.

8. See the section on Effects for a more thorough explanation of these issues with all sources cited.

9. See the section on Causes for a more thorough explanation of these issues with all sources cited.

10. See the section on Federal Response for more detail about these recommendations and attempted solutions, with all sources cited.

11. See the section on State Responses for more detail about the above-mentioned legislation, with all sources cited.

See also
References

12. "The State of Homelessness in America" (https://trumpwhitehouse.archives.gov/wp-content/ uploads/2019/09/The-State-of-Homelessness-in-America.pdf) (PDF). whitehouse.gov.

September 1, 2019. Archived (https://web.archive.org/web/20210120204713/https://trumpwh itehouse.archives.gov/wp-content/uploads/2019/09/The-State-of-Homelessness-in-America. pdf) (PDF) from the original on January 20, 2021. Retrieved September 17, 2019 – via National Archives.

13. U.S. Census Bureau (June 1, 2000). "Historical Census of Housing Tables Home Values" (h ttps://www.census.gov/hhes/www/housing/census/historic/values.html). Retrieved June 13, 2018.

14. U.S. Census Bureau. "MEDIAN HOUSING VALUE OF OWNER-OCCUPIED HOUSING UNITS" (https://archive.today/20200213004909/https://factfinder.census.gov/bkmk/table/1.0/ en/ACS/10_1YR/GCT2510.US13PR). American Community Survey. Archived from the original (https://factfinder.census.gov/bkmk/table/1.0/en/ACS/10_1YR/GCT2510.US13PR) on February 13, 2020. Retrieved June 13, 2018.

15. 1634–1699: McCusker, J. J. (1997). How Much Is That in Real Money? A Historical Price Index for Use as a Deflator of Money Values in the Economy of the United States: Addenda et Corrigenda (https://www.americanantiquarian.org/proceedings/44525121.pdf) (PDF).

American Antiquarian Society. 1700–1799: McCusker, J. J. (1992). How Much Is That in Real Money? A Historical Price Index for Use as a Deflator of Money Values in the Economy of the United States (https://www.americanantiquarian.org/proceedings/44517778.pdf) (PDF). American Antiquarian Society. 1800–present: Federal Reserve Bank of Minneapolis. "Consumer Price Index (estimate) 1800–" (https://www.minneapolisfed.org/about-us/monetar y-policy/inflation-calculator/consumer-price-index-1800-). Retrieved May 28, 2023.

16. "Table 12-13". United States Summary: 2010 Population and Housing Unit Counts (https://w ww.census.gov/prod/cen2010/cph-2-1.pdf) (PDF). United States Census Bureau. 2012. p. 30. Retrieved June 15, 2018.

17. Annual Estimates of Housing Units for the United States, Regions, Divisions, States, and Counties: April 1, 2010 to July 1, 2017 (https://archive.today/20200213004637/https://factfind er.census.gov/bkmk/table/1.0/en/PEP/2017/PEPANNHU) (Report). United States Census Bureau. July 1, 2017. Archived from the original (https://factfinder.census.gov/bkmk/table/1.0/ en/PEP/2017/PEPANNHU) on February 13, 2020. Retrieved June 15, 2018.

18. Annual Estimates of the Resident Population: April 1, 2010 to July 1, 2017 (https://archive.to day/20200215195807/https://factfinder.census.gov/bkmk/table/1.0/en/PEP/2017/PEPANNR ES/0100000US%7C0100000US.04000%7C0200000US1%7C0200000US2%7C0200000 US3%7C0200000US4) (Report). United States Census Bureau. July 1, 2017. Archived from the original (https://factfinder.census.gov/bkmk/table/1.0/en/PEP/2017/PEPANNRES/01000 00US%7c0100000US.04000%7c0200000US1%7c0200000US2%7c0200000US3%7c020 0000US4) on February 15, 2020. Retrieved June 15, 2018.

19. Romem, Issi (March 28, 2018). "California's Housing Prices Need to Come Down" (https://w ww.citylab.com/life/2018/03/californias-housing-prices-need-to-come-down/556637/).

Bloomberg. CityLab - The Atlantic Monthly. Archived (https://web.archive.org/web/20180330 154725/https://www.citylab.com/life/2018/03/californias-housing-prices-need-to-come-down/ 556637/) from the original on March 30, 2018. Retrieved May 3, 2018.

20. "MEDIAN HOUSING VALUE OF OWNER-OCCUPIED HOUSING UNITS (DOLLARS)" (http s://archive.today/20200213005047/https://factfinder.census.gov/bkmk/table/1.0/en/ACS/16_5 YR/GCT2510.US01PR). American Fact Finder. U.S. Census Bureau. 2016. Archived from the original (https://factfinder.census.gov/bkmk/table/1.0/en/ACS/16_5YR/GCT2510.US01P R) on February 13, 2020. Retrieved June 17, 2018.

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Housing Needs By State: California (https://nlihc.org/housing-needs-by-state/California), Washington, DC: National Low Income Housing Coalition
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External links

Retrieved from "https://en.wikipedia.org/w/index.php?title=California_housing_shortage&oldid=1179411438"

Rent Stabilization and Just
Cause for Eviction

CONCORD CITY COUNCIL WORKSHOP
OCTOBER 10, 2023
1

State Law Limits City Options
Rent Stabilization
•City Cannot:
•Regulate rents on any units built after 1995
•Regulate rents on single family homes or condominiums that can be sold separately from any other unit
•Impose vacancy control
2

State Law Limits City Options
Just Cause for Eviction
City Can, if More Protective than AB 1482:
• Impose just cause on all units- including single family homes • Impose additional relocation assistance for no-fault
• Further restrict just causes
• Impose additional requirements for no-fault evictions such as issuance of permits before substantial rehab or demolition evictions • Require additional relocation payments for Ellis Act evictions • Restrict when no-fault notices may be issued, e.g. during the school year 3

State Law Limits City Options
Just Cause for Eviction
•City Cannot:
• Extend state law noticing time periods, including for Ellis Act evictions
• Require City approval, petitions, mediation, or other administrative process prior to a tenancy termination
4

New Legislation- SB 567 (April 2024)
No-Fault Just Cause Owner Move-In
• Owner must occupy the property for a minimum of 12 months and must move into the unit within 90 days after resident vacates
No-Fault Just Cause Substantial Remodel
• Owner must provide written notice that includes expected scope of work and duration of time to completion, or expected date by which the property will be demolished, and a copy of permits required to undertake the substantial remodel or demolition.
• Right of Return if substantial remodel is not commenced or completed Increased Penalties for Failure to Comply
5

Council
Direction
Requested
• Capital Improvement Pass-Throughs
• Petition Costs
• Retroactive Rent Adjustment
• Substantial Renovation
• Right of Return
• Rent Registry Fees
6

Rent Stabilization- Council Direction
Requested
Capital Improvement Pass-Throughs
 Require pre-approval of scope of work and timing of capital improvements
 Include published amortization periods for each
improvement type
 Cap total rent with capital improvement adjustments and any allowable rent increases to cap set by AB 1482
7

Rent Stabilization- Council Direction
Requested
Petition Costs
Property Owner Petitions
 Covered by property owner
Tenant Petitions
Covered by Rent Registry fees, OR
 Covered by Rent Registry fees + minimal filing fee ($25 or $50)?
8

Rent Stabilization- Council Direction
Requested
Retroactive Clause set to January 12, 2023
Offer property owners the following options:
 Refund within 30 days of “go-live” date (expected to be January 11, 2024)
 Amortize the rent refund as cash payment or rent-credit over period equal to overpayment period
9

Just Cause- Council Direction Requested
Substantial Renovation for “No-Fault” Just Cause
 Definition to Match State Law- AB 1482 and SB 567
State law defines “substantially remodel” as “the replacement or substantial modification of any structural, electrical, plumbing, or mechanical system that requires a permit from a governmental agency, or the abatement of hazardous materials, including lead-based paint, mold, or asbestos, in accordance with applicable federal, state, and local laws, that cannot be reasonably accomplished in a safe manner with the tenant in place and that requires the tenant to vacate the residential real property for at least 30 days. Cosmetic improvements alone, including painting, decorating, and minor repairs, or other work that can be performed safely without having the residential real property vacated, do not qualify as substantial rehabilitation.
10

Just Cause- Council Direction Requested
Right of Return After Renovations Completed
 Allow tenants the following two options:
• Select “no fault” relocation payment and give up right of return
• Temporarily relocate and retain right of return
 Right to return to same base rent as when tenant vacated unit
Note: total rent may also include annual allowable rent increase + allowable capital improvement pass-through.
11

Just Cause- Council Direction Requested
Right of Return After Renovations Completed (Continued) Allow property owners the following options:

Relocation period is 60 days or fewer, relocate the tenant:
 To a hotel (and pay for necessary services and incidentals);  To a similar unit in the same complex or neighborhood; OR  To a mutually agreed upon alternate unit
Relocation period is 61 days or more, relocate the tenant:
 To a similar unit in the same complex or neighborhood; OR  To a mutually agreed upon alternate unit
12

Both Policies- Council Direction
Requested
Residential Rent Registry Fees
 Allow pass-through?
 What percentage?
13

Questions?
14

15

Rent Stabilization- No Further Direction
Required
Units Covered:
• Buildings with 2+ units
• LIHTC units
• Mobile home units (versus spaces)
• Exemptions to match AB 1482
• Exclude ADUs and rented rooms
 Rent Increase Limits: lesser of 60% of CPI or 3% per year, with no minimum.  Petition Types: Property Owner Fair Return and Capital Improvement Petitions, and Tenant Petitions. 16

Just Cause for Eviction- No Further
Direction Required
Units Covered:
• All units including single-family homes and condominiums • LIHTC units
• Mobile homes
• Exemptions to match AB 1482
• Exclude ADUs and rented rooms
 Relocation Assistance:
• Greater of 3 months’ rent or $8,500.
• Additional 1 month’s rent for vulnerable population
17

Both Policies- No Further Direction
Required
 Enforcement: Hearing Officer
18