Rent control spreads from pricey San Francisco to suburbs

ALAMEDA, Calif. – Charles Edwards is a merry self-described hillbilly from Tennessee who knows much about Victorian-era railroads and not so much about political campaigning.

But this year, the 77-year-old retired city gardener will be knocking on doors in Alameda to persuade voters of this maritime city on San Francisco Bay to support a citizen initiative to cap rent increases. Last June, the rent on his one-bedroom flat increased 24 percent to $1,300, leaving him $289 a month for utilities, food and other expenses.

“Like I say, I don’t like doing it, but I’m pushed in a corner, I feel like,” Edwards said.

Once upon a time, the concept of rent control was largely limited to costly, coveted cities such as San Francisco or New York where there were too many people and not enough apartments.

But tenant demand for protections is shifting to San Francisco Bay Area suburbs as priced-out workers flee to sleepy bedroom communities in search of cheaper dwellings. The region known for a sizzling tech-fueled economy has added 440,000 jobs but only 50,000 new housing units, according to the business-sponsored Bay Area Council.

State legislation approved last week to raise the state’s minimum wage to $15 an hour by 2022 is expected to help tenants afford increasing rents, but can only do so much in a region where the median rent is $3,350, according to real estate data firm Zillow.

Zillow calculates that a single earner would need an hourly wage of $67, or $33.50 each for two, in order to reasonably afford the rent.

“At least you’re taking a step in the right direction to address income inequality,” said Zillow’s chief economist Svenja Gudell, but added that, “$15 doesn’t move the needle all that much.”

Last year, a raucous city council meeting over rent control in Alameda, population 75,000, resulted in two arrests. Farther north, city leaders of Sonoma County’s Healdsburg, population 11,000, approved voluntary guidelines to keep rent increases to 10 percent or less.

Tenant activists in Alameda and Richmond – a waterfront industrial town of nearly 110,000 – are fighting to place rent control on municipal ballots this fall. So are residents of Burlingame, a pricey, leafy city of 30,000 on the San Francisco Peninsula.

The burst of Bay Area suburban squabbles doesn’t surprise analysts. The median rental price in the five-county San Francisco metropolitan area for February was $3,350, up 10.5 percent from a year ago, according to Zillow. Wages, while high for Silicon Valley professionals, have not kept pace for many other people.

Economists, landlords and developers say rent control makes the situation worse by restricting supply, resulting in run-down apartments and driving market prices higher. Tenant advocates, however, argue that caps on increases and other renter protections are critical in a housing market that’s ousting seniors and families.

Runaway rents are an issue nationally as the gap between wages and housing prices widen amid greater demand. Rent control is outlawed in 35 states, including Washington where Seattle proponents have asked state lawmakers to overturn the ban. West Hollywood in Southern California is the most recent city to pass a rent control ordinance that stuck – and that was in June 1985.

Advocacy group Tenants Together says a dozen cities have some form of rent control in California, including San Francisco and Los Angeles. Activists in Oakland and San Jose are also pushing beefed-up rent protections. A state law limits any rent restrictions on housing built after 1995 and exempts all single-family homes.

The three Bay Area ballot proposals would limit annual increases to the consumer price index or less, which would result in hikes in the low single digits rather than the double-digit ones that have renters clamoring for help. The measures also limit evictions to “just cause” so landlords can’t simply toss someone out for another tenant who can pay more.

In August, the Richmond City Council narrowly approved a rent control measure. But after a lobbying group for landlords collected enough signatures to put the issue to voters, the council repealed the ordinance. Activists are trying again.

On an overcast Saturday in Richmond last month, several dozen people packed a community center to learn how to collect signatures for the new initiative. They munched on burritos and chips before fanning out with clipboards.

“Something has to change,” said Gayle McLaughlin, a Richmond city council member and former mayor, “because we’re going to be a nation of internal refugees, people without places to live.”

The California Apartment Association is trying to qualify a competing measure for the November ballot that would prohibit restrictions on rental prices in Richmond. Landlords, such as Edwards’, say they need to recover costs to pay higher property taxes or for property improvements.

Thomas Bannon, the association’s chief executive, said he understands tenant concerns, but it’s not fair to ask landlords to shoulder the burden for a housing shortage.

“Rent control has never addressed that issue,” he said. “At best, it’s been a temporary fix for a very small number of units.”

Copyright 2016 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Rent control spreads from pricey San Francisco to suburbs

ALAMEDA, Calif. – Charles Edwards is a merry self-described hillbilly from Tennessee who knows much about Victorian-era railroads and not so much about political campaigning.

But this year, the 77-year-old retired city gardener will be knocking on doors in Alameda to persuade voters of this maritime city on San Francisco Bay to support a citizen initiative to cap rent increases. Last June, the rent on his one-bedroom flat increased 24 percent to $1,300, leaving him $289 a month for utilities, food and other expenses.

“Like I say, I don’t like doing it, but I’m pushed in a corner, I feel like,” Edwards said.

Once upon a time, the concept of rent control was largely limited to costly, coveted cities such as San Francisco or New York where there were too many people and not enough apartments.

But tenant demand for protections is shifting to San Francisco Bay Area suburbs as priced-out workers flee to sleepy bedroom communities in search of cheaper dwellings. The region known for a sizzling tech-fueled economy has added 440,000 jobs but only 50,000 new housing units, according to the business-sponsored Bay Area Council.

State legislation approved last week to raise the state’s minimum wage to $15 an hour by 2022 is expected to help tenants afford increasing rents, but can only do so much in a region where the median rent is $3,350, according to real estate data firm Zillow.

Zillow calculates that a single earner would need an hourly wage of $67, or $33.50 each for two, in order to reasonably afford the rent.

“At least you’re taking a step in the right direction to address income inequality,” said Zillow’s chief economist Svenja Gudell, but added that, “$15 doesn’t move the needle all that much.”

Last year, a raucous city council meeting over rent control in Alameda, population 75,000, resulted in two arrests. Farther north, city leaders of Sonoma County’s Healdsburg, population 11,000, approved voluntary guidelines to keep rent increases to 10 percent or less.

Tenant activists in Alameda and Richmond – a waterfront industrial town of nearly 110,000 – are fighting to place rent control on municipal ballots this fall. So are residents of Burlingame, a pricey, leafy city of 30,000 on the San Francisco Peninsula.

The burst of Bay Area suburban squabbles doesn’t surprise analysts. The median rental price in the five-county San Francisco metropolitan area for February was $3,350, up 10.5 percent from a year ago, according to Zillow. Wages, while high for Silicon Valley professionals, have not kept pace for many other people.

Economists, landlords and developers say rent control makes the situation worse by restricting supply, resulting in run-down apartments and driving market prices higher. Tenant advocates, however, argue that caps on increases and other renter protections are critical in a housing market that’s ousting seniors and families.

Runaway rents are an issue nationally as the gap between wages and housing prices widen amid greater demand. Rent control is outlawed in 35 states, including Washington where Seattle proponents have asked state lawmakers to overturn the ban. West Hollywood in Southern California is the most recent city to pass a rent control ordinance that stuck – and that was in June 1985.

Advocacy group Tenants Together says a dozen cities have some form of rent control in California, including San Francisco and Los Angeles. Activists in Oakland and San Jose are also pushing beefed-up rent protections. A state law limits any rent restrictions on housing built after 1995 and exempts all single-family homes.

The three Bay Area ballot proposals would limit annual increases to the consumer price index or less, which would result in hikes in the low single digits rather than the double-digit ones that have renters clamoring for help. The measures also limit evictions to “just cause” so landlords can’t simply toss someone out for another tenant who can pay more.

In August, the Richmond City Council narrowly approved a rent control measure. But after a lobbying group for landlords collected enough signatures to put the issue to voters, the council repealed the ordinance. Activists are trying again.

On an overcast Saturday in Richmond last month, several dozen people packed a community center to learn how to collect signatures for the new initiative. They munched on burritos and chips before fanning out with clipboards.

“Something has to change,” said Gayle McLaughlin, a Richmond city council member and former mayor, “because we’re going to be a nation of internal refugees, people without places to live.”

The California Apartment Association is trying to qualify a competing measure for the November ballot that would prohibit restrictions on rental prices in Richmond. Landlords, such as Edwards’, say they need to recover costs to pay higher property taxes or for property improvements.

Thomas Bannon, the association’s chief executive, said he understands tenant concerns, but it’s not fair to ask landlords to shoulder the burden for a housing shortage.

“Rent control has never addressed that issue,” he said. “At best, it’s been a temporary fix for a very small number of units.”

Copyright 2016 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.