SB 184 (Leno), a bill to impose rent control on new construction of rental housing, died on the Senate floor yesterday. SB 184 was opposed by the California Association of REALTORS® because it would have weakened key provisions of the Costa Hawkins Act, which C.A.R. sponsored in 1995 to help encourage the development of new rental housing in our State.
Enactment of SB 184 would have made it a virtual certainty that local agencies would impose residential rent control on new construction, discouraging the development of such housing at a time when it is most needed.
The Legislature agreed with our opinion of SB 184 and it died on the Senate Floor on January 31, the last day for bills to get out of their house of origin if they are to continue on through the legislative process this year.
The REALTOR® profession for years has opposed rent control on grounnds that it impacts private property rights and reduces the ability of owners to make improvements to their properties. However, rent control creates major setbacks for tenants as well, in part because it may reduce - not increase - the number of units acually available to rent on the market. Don't miss Thomas Sowell's excellent analysis of rent control in his book Basic Economics, required reading for anyone in real estate, policy or economics, regardless of your political stripes.
