California voters this week rejected a measure that would have allowed cities and local jurisdictions to expand rent control.
Nearly 6 in 10 voted against Proposition 21, according to The Los Angeles Times. Had the proposition passed, local governments would have been able to enact rent control on far more properties than currently possible, lifting exemptions on single-family homes and housing built before 1995. The prop would also have limited how much landlords could raise rent prices.
The measure is one of 10 propositions that drew over $100 million in spending, with big businesses investing huge amounts of money in these races.
The Yes on Prop 21 campaign was sponsored by the AIDS Healthcare Foundation and raised more than $40 million in campaign donations, Ballotpedia reported. Supporters of the proposition included Vermont Sen. Bernie Sanders, the ACLU of Southern California and Black Lives Matter Los Angeles, according to the campaign’s website.
Opposition to the proposition raised almost double that of Yes on Prop 21: $73 million. Major contributors were organizations such as Essex Property Trust, Inc., and Equity Residential, according to Ballotpedia. Notable opposers included President Donald Trump via the GOP, Gov. Gavin Newsom and the California Chamber of Commerce.
Supporters commended Prop 21 as a solution to California’s high housing prices, while others criticized the potential effect it would have on small landlords and questioned the long term benefits.
Gary Painter, professor at the USC Price School of Public Policy and director of the Los Angeles region’s Homeless Policy Research Institute, spoke about whether or not rent control is an effective solution to economic and social problems.
“Rent is going up much faster than people’s income,” Painter explained in an interview with Annenberg Media. “One of the things that rent control could do is reduce the rate of increase for rent, therefore displacing fewer people from their homes.”
Scott Tamkin, a real estate agent in the greater Los Angeles area, said he was opposed to the proposition because it would have limited what landlords could charge their tenants. According to Tamkin, many homeowners choose to rent out their property at some point and the proposition could limit their income.
Tamkin argued that landlords must be able to increase prices proportional to the cost of living and maintenance of the property.
“We’re a free market economy and I think people are willing to pay a certain amount of rent,” Tamkin said in an interview with Annenberg Media. “Los Angeles has always been an area of higher cost in real estate. I don’t think it’s the government’s place to govern what people can charge for rent.”
Prop 21 would have not forced rent control, though, it would have only allowed cities and jurisdictions the ability to do so.
Citing the pandemic and economic fallout, Painter argued that in the short-term Prop 21 likely would not have had any effect because rent has decreased in many places since the start of the pandemic.
In the long-term, though, in places South LA, Hollywood and Inglewood, passage of rent control could reduce displacement as investments pour into these communities and rent prices increase, Painter said. This investment and displacement leads to gentrification, especially in an area like South LA where USC continuously expands into the less-wealthy outside community.
While the long-term effects of rent control are contested, Prop 21, like Prop 22, voted in line with the big businesses that poured huge sums of money into the race.
“The rejection of Prop 21 and even the passage of Prop 22 actually suggest that spending an inordinate amount of money to get your position passed, and with commercials, that are, I’ll be nice and say misleading, is a powerful tool to influence voters,” Painter said.