Why I am Voting No On Prop 33

Why I am voting NO on Proposition 33 

There is an important measure on this year's election ballot that impacts homeowners and renters alike and will have significant consequences on rental rates, housing and rental supply, and new housing being built in California. In a world in which the left and the right rarely meet in the middle, there is a wide field of both Democrats and Republicans who oppose election ballot measure Proposition 33. Similar measures have been shot down twice before by Democrats and Republicans. Yes, this is the third year that the measure is on the ballot after a majority of Californian’s have already voted NO twice before. 

Prop 33, if passed, will repeal a common-sense bi-partisan housing law that was passed by both Democrats and Republicans in 1995. That law is Costa-Hawkins. Costa-Hawkins was passed to allow for sensible rent control and tenant protections while limiting local governments’ ability to place rent control on individual homes and condos as well as new construction apartment buildings in an effort to help encourage development. Costa-Hawkins also prevents the government from implementing vacancy control. Vacancy control prevents housing providers from renting property at market rental rates in-between tenants.  

To be clear, California currently has rent control in place which ranges from 5% - 10% per year. State law says that rents can't be increased more than 5% plus CPI, with a cap at 10%.  Prop 33 would remove the common-sense safety guardrails put in place by Costa-Hawkins. These safety guardrails protect individual home owner rights while also encouraging new development and Prop 33 will remove those guardrails. 

Many Democrats and Republicans have recommended a NO vote on Prop 33, voicing concern that Prop 33 would stifle much needed new construction.  The passage of Prop 33 would also harm renters by causing the removal of countless rental properties throughout the state. In addition, if vacancy control is implemented, it will likely encourage landlords to raise rent the maximum amount each year to keep up with market rate, when right now landlords may do modest if any increases on a tenant. 

A NO vote on Prop 33 means:

1. Current rent control law remains in place and cannot become more restrictive at the local level.
2. Homes, condos, and new construction apartments are exempt from rent control. This protects small “mom and pop” rental housing providers, absentee housing owners that might want to move back into their homes, and it entices developers to keep on building and developing more affordable housing in the Golden State.
3. Vacancy control is not allowed. Thus, housing providers can reset rent to market value when a tenant moves out and a new tenant moves in.

A YES vote on Prop 33 means:

1. Local government can implement new rent control laws that could be passed by unelected housing boards.
2. Homes and condos can fall under rent control ordinances. If homes and condos fall under rent control ordinances, countless California rental homes and condos will be pulled off the rental market by their owners, with many owners deciding to simply sell their properties rather than dealing with stricter rent control laws and regulations. This will ultimately lower the inventory of rental housing available to renters throughout California. Renters should have a choice of renting an apartment unit, a condo, or a single-family home. The passage of Prop 33 would remove many of the single-family home and condo choices currently available to renters. Of course, with the removal of rental housing units, finding a place to rent in California will become even more challenging.
3. Rent control can be implemented on new construction. If rent control and other restrictive policies are placed on new construction buildings, developers will simply build less real estate in California at a time when we need more housing.
4. Vacancy control can be implemented on apartments and rental homes. Vacancy control simply means that a landlord cannot raise rents in-between tenants. If Tenant A moves out and Tenant B moves in, Tenant B’s rent must be indexed to Tenant A’s rent. In other words, a landlord is not allowed to set the unit’s rent to market rent in-between tenants. This will cause two things to happen: (1) many rental units will be pulled off the market thus further lowering rental inventory available to renters and (2) tenants lucky enough to secure a rental property will likely face constant maximum allowable annual rent increases. Housing providers and tenants will no longer have the luxury of keeping rents the same year over year because the housing provider will not be able to fall behind on market rents for fear of never being able to catch up in-between tenants. Tenants will likely face maximum rent increases every single year.

History tells us that anytime the government gets too involved in an economic Supply and Demand problem, the problem often becomes worse.  I am concerned that if Prop 33 passes, our supply of real estate will go down, especially for renters.  If having a high cost of rent is bad, not having a property to rent in the first place is even worse.  If Prop 33 passes, we will come to find that, although the Proposition has the goal of helping tenants, it will likely make finding an available rental unit far more challenging and expensive for all tenants and renters throughout California, further forcing our young population to have to move out of state.  For these reasons, I am voting NO on Prop 33.

Contact me with any questions or visit the Secretary of State website Voter Guide for Prop 33.