MBA, Trade Groups Voice Opposition to California Rent Cap Bill
Mortgage Bankers Association President and CEO Robert Broeksmit, CMB, joined leaders of nearly a dozen industry trade associations in a letter opposing a controversial California bill that would impose rent caps on property owners.
The bill, AB-1482 (https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201920200AB1482), would ostensibly prevent rent spikes for certain tenants by imposing a 5 percent cap on rent increases beyond the percentage of regional inflation. The bill passed the California Assembly on May 29 by a 43-28 vote and is now under consideration in the California Senate.
However, the trade group letter, initiated by the National Multifamily Housing Council, said AB-1482 would curb the building of housing in California, thereby contradicting its stated purpose of solving the housing affordability crisis.
“A growing number of families in California are struggling to find housing they can afford, driven by a shortage of 3.5 million homes,” the letter said. “Research based on real-life examples here in California has shown that rent control exacerbates housing shortages and disproportionally benefits higher income households–ultimately hurting families that need the most help.”
Moreover, the letter said, the California Legislative Analyst’s Office found that expanding rent control could cost the state hundreds of millions of dollars annually, mostly through lost property values.
“That is why California voters overwhelmingly rejected a ballot initiative in 2018 that sought to expand rent control throughout the state,” the letter said. “To tackle the housing affordability crisis, we need public-private partnerships to help bring the price point down to create more affordable housing, more supply overall to address the critical housing shortage, including by reducing the regulatory cost of building a home and an increase in direct assistance to renters. It’s more effective to tie assistance to a renter rather than a rental unit.”
Joining NMHC and MBA in the letter were leadership from the National Apartment Association, Nareit, the California Mortgage Bankers Association, the Institute of Real Estate Management and local IREM affiliates, including chapters in the California Central Coast, Sacramento Valley, San Diego, San Francisco Bay Area, Greater Los Angeles, Orange County, San Joaquin and Southern California Inland Empire.
Earlier this week MBA announced launched a strategic initiative to help develop stronger and more effective affordable housing partnerships in both the policy and business arenas. The objective of these partnerships will be to promote more sustainable, affordable homes for purchase and rental for underserved people and communities, especially minorities and low-to-moderate-income Americans.
Steve O’Connor, a 23-year veteran of MBA and currently its Senior Vice President for Public Policy and Industry Relations, will assume the new role as Senior Vice President for Affordable Housing Initiatives.
