Will California’s Rent Control Measure Prop. 10 Really have No Effect on Homeowners?


Will California’s Rent Control Measure Prop. 10 Really have No Effect on Homeowners?

2018-10-08T12:37:36+00:00October 8th, 2018|Advocacy, Local Updates|

“Much of the debate over California’s rent control measure, Proposition 10, has centered on how it will affect apartment dwellers and landlords.

But a claim by the Yes on 10 campaign in a recent TV ad has fueled questions over how homeowners will fare should the measure pass in November.

Here’s what the ad says:

“Independent voices urge Yes on Prop 10. League of Women Voters, Los Angeles Times, Sacramento Bee all say Prop 10 will empower your local community to limit rent increases. No effect on homeowners. Help for struggling renters. Vote yes on 10.”

The measure’s opponents seized on the claim that Prop 10 would have “no effect on homeowners.” They argue that statement is false and “recklessly disregards the truth.” They’ve asked media outlets to pull the ad.

Given the disagreement over the claim and significance of the ballot measure, we decided to check the facts.

This, however, is not the only claim that’s in dispute. There’s also disagreement over whether rent control really helps “struggling renters,” as the ad states. Economists argue it helps the select few who have their rents capped, but has the unintended consequence of making rental housing scarcer and increasing the average rent citywide, a topic Capital Public Radio explored earlier this year.

Background on Prop 10

Prop 10 would repeal the state’s Costa-Hawkins Rental Housing Act, which blocks rent control on units built after February 1995. The law also prevents cities from imposing rent caps on condominiums and single-family homes.

Repealing the law would allow cities to craft their own, potentially stronger, rent control rules, including on condos and single-family homes.

report released this month by UC Berkeley’s Fisher Center for Real Estate & Urban Economics found the measure would negatively affect owners who rent out single-family homes.

Rent control on single-family homes “would decrease property values for homeowners by 10 percent to 15 percent over time,” for the more than 2 million California owners who rent out single-family homes, according to the study.

A spokesman for the No on 10 campaign added that, based on the campaign’s interpretation of existing laws, rent control would automatically be imposed on single-family home rentals in several cities should Prop 10 pass. Supporters of the measure rejected that interpretation.

Response from Yes on 10

Asked about the claim in the ad, the Yes on 10 campaign emphasized that the initiative doesn’t force cities to impose any rent control rules. It simply gives them that option.

“The measure itself does not make any changes to local rent control laws,” wrote Beverly Grossman Palmer, an attorney for the Yes on 10 campaign, in a letter to broadcasters. “This is a campaign, not a legal brief. The California voters who view this ad understand the message: People who own their own homes are not going to be affected by rent control measures.”

Peter Dreier, a professor of politics at Occidental College who has testified to lawmakers in favor of Prop 10, said there’s another reason to believe the measure won’t affect homeowners: It “would be politically stupid” for cities to impose rent control on single family homes.

“There’s never been a rent control law in the country to that effect,” he said. “That’s not going to happen.”

Apartment associations and real estate groups have contributed more than $30 million to defeat Prop 10. Supporters, meanwhile, have raised more than $12 million dollars for it, primarily from the AIDS Healthcare Foundation. The foundation is a nonprofit group based in Los Angeles, and is active in supporting political campaigns.

Our ruling

In a recent TV ad, the Yes on 10 campaign claimed California’s rent control measure would have “no effect on homeowners.”

Prop 10 would not force cities to impose rent control, but it would give them that option — including on single family home rentals.

Prop 10 supporters say it would be a politically poor decision for cities to do that. But that doesn’t mean it won’t happen.

The TV ad is partially accurate. But it leaves out the key information that single-family homes are currently exempt from rent control in the state, and that Prop 10 would at least give cities the option to impose rent regulations on them.

We rate the claim Half True.”

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