California's Government Loves Homelessness So Much They Passed a Rent Control Law

(AP Photo/Rich Pedroncelli)

The state of California spends billions of dollars a year on their massive homeless problem and there are still tens of thousands of citizens who live in their cars, on the street, and in tent cities.


The reason is fundamental: there isn’t enough affordable housing for the middle class.

In big California cities like Los Angeles and San Francisco, the only people who can afford to live there are the very rich and, because of generous subsidies, the very poor. To anyone who isn’t a socialist nutjob, the solution is painfully obvious: remove disincentives for builders to construct reasonably priced, multi-unit housing.

One such disincentive is rent control. Without the ability to increase or decrease rent, the only incentive for building owners is to charge as much for rent as the law allows. In other words, if the market were to dictate the amount of rent a property is worth, there would be plenty of incentive to keep rents reasonable.

Not so in California. Governor Newsom just signed a bill that would cap rents for the next decade.

To all the homeless people living on the streets, scoot over. You’re going to have company.

Fox News:

The law signed by Newsom limits year-over-year rent increases to five percent plus inflation until Jan.1, 2030. Landlords are also barred from evicting tenants without just cause, a provision meant to curb evictions just to raise rents.

The law doesn’t take effect until Jan. 1 but retroactively applies to rent increases on or after March 15 of this year to prevent landlords raising rents before the cap goes into effect.

Democratic Assemblyman David Chiu, who authored the bill, estimates the law will apply to 8 million of the state’s 17 million renters. It would not apply to housing built within the last 15 years, single-family homes except those owned by corporations or real estate investment trusts, or those living in rent-controlled units. Duplexes where the owner lives in one of the units also are not affected by the new law.


California’s housing crisis is self-inflicted. It’s not the result of rapacious businessmen gouging their tenants or evil landlords plotting to throw people out on the street for no reason. All the state has done with this new law is create another layer of red tape to discourage builders.

Russell Lowery, executive director of the California Rental Housing Association, said the law adds another layer of red tape to the eviction process.

“It adds unnecessary expenses to all rental home providers and makes it more difficult to sever a relationship with a problem tenant,” he said.

Politicians are responding to the immediate cries of the people for relief instead of creating policies that will make things better in the future. They have chosen expediency over wisdom. And they are going to continue to pay for it by worsening an already critical housing shortage.


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