Landlords say state rent caps may force them to raise rents more frequently

ANDREW KHOURI

Prominent landlord attorney Dennis Block stood before a crowd of more than 200 at an apartment owners trade show in Pasadena and, to laughs, boasted of having evicted “more tenants than anybody else on the planet Earth.”

Block said he was proud to enforce what he said America was built on: property rights. He then talked about the “scourge of this new statewide rent control that is coming up” and offered some ways that landlords could evade rules that as of Jan. 1 would cap annual increases for tenants at 5% plus inflation and require “just cause” to evict.

His advice? Quickly hand out no-fault eviction notices to tenants who pay low rent or make frivolous requests.

“You don’t have to feel bad about this,” he said Wednesday at the trade show for the Apartment Assn. of Greater Los Angeles, which represents landlords. “It’s not your fault, it’s the state legislators’ fault.”

Gov. Gavin Newsom is expected to sign Assembly Bill 1482 into law this month. And while supporters celebrate its potential to stanch the flow of people who are priced out of their communities or onto the streets, landlords are grappling with what it means for them.

Read the rest of the article on The Los Angeles Times


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2 Responses to Landlords say state rent caps may force them to raise rents more frequently

  1. c e voigtsberger October 12, 2019 at 6:38 pm

    At a chamber board of directors meeting two directors got into an argument about the amount of taxes and fees included in the cost of a new home in the City of Ventura. One, a realtor, stated that the cost of taxes and fees amounted to 49% of the cost of a new home. Another ultra liberal member immediately chimed in with, “Oh, no, its’s not, it’s only 29%.”

    The median price of a new home in the City of Ventura at that time was $150,00 (Yeah, it was at least a couple of years ago).

    If we assume that the real figure for taxes and fees is somewhere between 29% and 49% and settle on the figure of 30% to be conservative in our approach, that means the taxes and fees on the mythical median priced homes at that time were $45,000. At the time I thought that was ghastly.

    I am sure in the intervening years since that argument took place, taxes and fees have not regressed. So let’s assume for the sake of this letter that they have remained fixed at 30% and lets assume that the mythical median price of a new home in Ventura is $250,000. That means that the builder has to pony up $75,000 in either take out loans or, heaven forbid, his own money on each house in his tract. This is before he even sees a dime of sales income. It doesn’t include the cost of a single nail or stick of lumber — oh, and by the way, the state has imposed a 10% “depletion fee” (in non-newspeak that is called a tax) on lumber sold in the state, so you can add that into the 30% because that figure was derived in the non-depletion fee days.

    After digesting these really conservative figures, does anyone reading this wonder why average folks can’t afford a home in Ventura? It isn’t that they want to buy a brand new McMansion, but when the price of new McMansions is only within reach of some folks on the public payroll, it affects the cost of that 850 square foot fixer upper on the Avenue.

    I don’t know how these figures apply to the City of Oxnard, but considering their dire spending habits, I suspect they apply in Oxnard as well.

    Reply
  2. William Hicks October 12, 2019 at 2:57 am

    This will not please both Thousand Oaks and Ventura County decision makers, but the shortage of “affordable” housing is a supply/demand problem.

    At least one of the causes is an overly generous open space policy. I came out here in the 1970’s from the San Fernando Valley. The reason I didn’t stay in The San Fernando Valley wasn’t because there wasn’t adequate open space, but because this was where I could find an affordable house. That was before Newbury Park was incorporated into Thousand Oaks and before the voters had an “I’ve got mine, get yours somewhere else” attitude.

    AND NO, I’M NOT A REALATOR!

    Reply

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