California lawmakers have approved a statewide rent control measure on Wednesday, that would cap rent increases to 5% after inflation. Expecting to affect nearly eight million people, the measure provides a certain amount of housing security in the state with the highest housing prices in the nation.
Governor Gavin Newsom lead the charge on negotiating the measure with lawmakers. Newsom has made tenant protection a key point in his first year in office, and has been very active prior to legislative recess.
When speaking on the measure, Assemblyman David Chiu says, “The housing crisis is reaching every corner of America, where you’re seeing high home prices, high rents, evictions and homelessness that we’re all struggling to grapple with,” continuing, “Protecting tenants is a critical and obvious component of any strategy to address this.”
The measure itself caps rent increases to 5% after inflation, and takes effect from March this year. In addition, it protects from eviction without cause, which is a major factor in the growing homeless population. This measure however, will not affect those in cities or towns that have already enacted a version of rent control.
A major proponent of the measure was the California Business Roundtable, who say the measure creates “a statewide standard that will put more than 95 percent of multifamily units under a consistent and uniform rent standard.” Also, it will provide “certainty to both renters and developers during our ongoing housing crisis.”
Currently in California, about 9.5 million people in the state spend 30% or more of their income purely on rent. With housing prices rising at such a rate, without legislation that percentage would continue to rise.
This makes California the third state in the nation to adopt statewide rent control. In March, Oregon capped increases at 7% after inflation, and New York enacted a version of it in June.
