Costa Hawkins Under Assault
By DANIEL BORNSTEIN, ESQ.
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We’ve seen this movie before, but not on such a large scale as attempting a roll back of the long-standing Costa-Hawkins.
Enacted in 1995, the Costa-Hawkins Rental Act put a check on a municipality's inkling to meddle with what a property owner could charge for rents. Local governments were prohibited from exerting their heavy hand and establishing rent control over single family dwellings and newly constructed units. It also prohibits “vacancy control”, known in some parliaments as “strict rent control”, which would deny or limit an owner’s ability to increase rents to new tenants.
In other words, Costa-Hawkins gives the rental property owner the right to rent the unit at market rate. Not that bad a transgression, to rent the apartment for what someone is willing to pay for it, is it?
A plan is afoot to repeal the Costa-Hawkins Rental Housing Act, legislation that insulates property owners and renters from the fiat of the government and rent control measures. Among other groups backing the measure is a national community organizing group, an eviction-protection group and a no-growth advocate who attempted to pass Measure S in Los Angeles, a failed ballot that would have put a moratorium on most post apartment construction for a two-year period.
Repealing Costa-Hawkins has been an intractable battle, with both sides burrowed in. Landlords and tenant advocates both saw AB-1506 as the impetus for a more protracted fight over rent control in Sacramento. Landlords have voiced their concern that developers will build fewer homes if they don’t have assurance that their projects can’t be subject to rent control, and this sentiment is echoed by Tom Bannon, CEO of the California Apartment Association.
"If rent control ordinances are allowed to regulate rents on new construction and single-family homes, new private investment into rental housing will come to a screeching halt.... without private investment in the development and construction of new rental housing, California's economic expansion will be in jeopardy".
We agree that if Costa-Hawkins is repealed, California’s housing situation will go from a serious problem to a catastrophic problem, but we remain confident that cooler heads will prevail and the basic property rights of homeowners will remain intact.
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As the founding attorney of Bornstein Law, Broker of Record for Bay Property Group and expert witness, Daniel Bornstein is a foremost and well-respected expert in landlord-tenant disputes and other property management issues with over 23 years of experience in handling real estate and civil litigation related disputes in and throughout the Bay Area. More than a litigator, Daniel manages rental properties, assists in completing real estate transactions and is well known for his educational seminars. He is always eager to answer questions and engage with Bay Area landlords, property owners and real estate professionals. Email him today.