What would you do if you knew the value of your apartment building could drop by 30% to 40% after November of this year? That’s what happened in the state of New York where “vacancy control” is allowed! That’s what could happen in California and what some really “big money people” have planned, if apartment owners do nothing to stop Prop. 33 – this so-called “Justice for Renters” Act. It will be on this coming November’s ballot!
“Injustice” for Housing Providers and Homeowners
That’s what this devastating proposal should be called! It could force apartment owners to charge whatever the current rent is when a renter moves out and your next renter moves in and that’s what this bill allows your politicians to do to you! Your new renter could be required to pay no more than what your former renter was paying. That’s “vacancy control” and that’s just one thing that this “Justice For Renters”Act could do if they win in November. You should tell your home owning friends that their home could be put under rent control with inspections by city officials telling them what to do to bring their home up to the inspectors’ standards. If the work is not done, the city could do the repairs and send them a bill, AND put a lien against their home OR the city could declare their property “uninhabitable” and make them move out until the work is complete! Believe it, these types of things are happening to apartment owners now! That alone could cost them tens of thousands of dollars!
Folks, that is just too much government telling us how to run our business! This type of dictatorship is what’s acceptable in countries like China and Russia. Let’s not let it happen here in the good old U.S.A. We all need to dig deep and really get serious about stopping this costly and “unjust” bill! it!
Could Cost Our Industry Millions of $$$!
Gideon Kramer, SPOSFI News Editor explains it best:
“Let’s look at an example over just five years of how vacancy control might work. The authors of the “Justice for Renters Act” have given the public no clue, leaving the “details” to local jurisdictions. If vacancy control becomes law, dictating that a new tenant pays the same or slightly more rent than an outgoing tenant, the gap between market and actual rent will widen every year, as illustrated in the table below. Consider this scenario:
In 2015, Jane rented a rent-controlled studio for $1,500. In December 2019, she vacated and a new tenant moved in. Let’s assume market rent increased at 5% a year and the allowable rent increase averaged 2.5%. This is what happens to just one unit in your building:
This could happen to your rental income…
| Year | How it might be today | WITH VACANCY CONTROL |
| 2015 | $1,500 | (starting/mkt rent) $1,500 |
| 2016 | $1.537 | (1,500 x 2.5%) $1,537 |
| 2017 | $1,576 | (1,537 x 2.5%) $1,576 |
| 2018 | $1,615 | (1,576 x 2.5%) $1,615 |
| 2019* | $1,655 | (1,615 x 2.5%) $1,655 |
| 2020 | $1,914 | (1,500 x 5% x 5) $1,696 |
(Your loss: $2,616.00 a year on this one unit)
Vacancy Control and the Long-Term Tenant
Now, imagine a unit rented not in 2015, but 1985. The tenant has been there ever since, and due to rent control, his rent is only $1,100. Finally, in 2024, he moves out. Two questions come to mind immediately:
- Would the lucky new tenant get a nice one-bedroom unit for just $1,128, and who would decide who gets it?
- What incentive would the owner have to ever refurbish the unit or maintain his money-losing property?” (Your loss: $9,432.00 a year on this one unit)
How to Stop This “Highway Robbery”
Well, none of us want to lose our freedom, property rights and income. So … the only way we can once again beat this anti-Costa-Hawkins bill is to do what successful politicians do to get elected: they spend millions of dollars on advertising. And AOA, in addition to many other big apartment owners and other organizations, will once again advertise. Last time our industry defeated these guys, it took over 80 million dollars in addition to a lot of hard work!
Please Dig Deep Now!
Winning this political battle is so important to you and your financial wellbeing that we are asking you to donate a non-tax deductible donation of at least $1,000 or $100 for every unit you own if you own more than ten (10) units. Idea: If you run a property management company, you could ask each one of your accounts to make a donation and you could cut the checks from their account. This could really be a big help to protect the values of your properties!
“SPECIAL NOTICE”
You may be one of the many owners who could and should be investing much more in this campaign to protect our free enterprise system and your millions of dollars of property values. A $10,000 to $100,000 donation will go a long way to win this battle and could be one of your best investments of 2024! Feel free to call me, Jeff Faller, at (213) 872-3848 to discuss what we are doing to win. This goes for all owners who donate any amount. Call me today!
EDITOR’S NOTE: Please donate NOW. Every rental property owner needs to contribute at least $1,000 to oppose this ballot measure. We beat Weinstein before on this and we HAVE to do it again! Please, please donate NOW! You can contribute online at https://aoausa.com/pac/ or mail the coupon below with your check made payable and addressed to AOA PAC to 6445 Sepulveda, Suite 100, Van Nuys, CA 91411.
