Trade Show a Huge Success!
Our “Million Dollar” Trade Show and Landlording Conference last month was a huge success! You should have been there! Our members were more educated, motivated and stimulated by some very knowledgeable speakers who helped give them that one idea that will help them make and keep more money than ever! Some even walked away with valuable prizes given away at every seminar! WOW! Where else could you possibly spend a more profitable day?
There was no place in the world like the Long Beach Convention Center on Wednesday, May 24th! Our members really know how to take advantage each year of this incredible source of information and…it was all free! It’s just one of the many services we provide for our members in addition to the lowest membership dues and credit check fees as well as the best service in town!
Many thanks go to our dynamic speakers – Real Estate Attorney, Dale Alberstone, Eviction Attorney Dennis Block, Foreclosure Specialist Bruce Norris of the Norris Group, Steve Sitkowski, Financial Specialist, Tax Lien Specialist Wayne Gray, Asset Protection Specialist Dale West, Tax Specialist Karla Dennis, and Nick Sidoti -“Dr. Cash Flow” They provided the most powerful and contemporary information on wealth-building and apartment landlording that you’ll ever be able to find.
Our thanks also go to our large variety of exhibitors and their commitment to our members in offering the best possible professional assortment of services. Be sure to see highlights of the show and photos included in this issue.
And … a very special thanks goes to you, our members, who truly are the essence of our trade show success! Your generosity to our Union Rescue Mission Canned Goods Drive was greatly appreciated. Thank you! And your thirst for knowledge in your pursuit of excellence is a driving force in the betterment of our industry! A thousand thanks….and we’ll see you at our next trade show at the Los Angeles Convention Center in September!
It pays and saves you big just to be an AOA member. BUT…it pays and saves even more for those owners who turn up every year to discover new ideas at the Big Show!
Rent Control Would Put Housing
Out of Reach for More Californians
The below article was written by Kerry Jackson, a fellow with the Center for California Reform at Pacific Research Institute. The mission of the Pacific Research Institute (PRI) is to champion freedom, opportunity, and personal responsibility for all individuals by advancing free-market policy solutions. For more information, visit www.pacificresearch.org.
The most unaffordable city in the world in which to rent a home is not New York or Tokyo or Hong Kong. The title belongs to San Francisco, where a single person who wants to live on their
own needs to earn more than $85,000 a year to pay the rent and a family more than $163,000.
Not far behind is Los Angeles, ranking 10th in the world, according to the 2017 Rental Affordability Index compiled by Nested, an international real estate service.
Surely, there’s been a mistake. Both cities, as well as a dozen or so others in California, have rent-control laws that were enacted to control costs. Rent-control laws simply don’t work, though. And rather than keep rents down, they actually discourage the development of additional housing that would lower prices.
According to the nonpartisan Legislative Analyst’s Office, government attempts to make housing more affordable – rent control, for one example – do “very little to address the underlying cause of California’s high housing costs: a housing shortage.”
If rents were allowed to freely rise in response to market pressure, developers would address the shortage by building more units. The expanding housing stock would push prices down. As
Brookings Institute economist Anthony Downs explained three decades ago, “stringent controls prevent owners from reaping the unusually high profits that would trigger the development of additional new rental units.” Rent control can also create run-down neighborhoods. The Legislative Analyst’s Office says that because rent-control policies “reduce the income received by owners of rental housing,” the rational response of owners is often “to cut back their operating costs by forgoing maintenance and repairs.”
“Over time,” says the report, “this can result in a decline in the overall quality of a community’s housing stock.” Pacific Research Institute has just released a new issue brief on California’s housing crisis, identifying rent control as one of the factors making housing unaffordable in the Golden State.
Despite rent control’s miserable record, some lawmakers believe that one day it will finally work. Among them are three Democratic Assembly members who introduced a bill (Assembly Bill 1506) that would repeal the 1995 Costa-Hawkins Rental Housing Act. Current law restricts rent control laws from being enforced on units which were occupied after Feb. 1, 1995, or on properties that were already exempt from local residential rent control ordinances on or before that date. The law “also allow(s) landlords to reset rents to market rates when properties transferred from one tenant to another,” according to the Legislative Analyst’s Office, and protected single-family homes from rent control.
If Costa-Hawkins is repealed when they bring it up again next year, then every home in the state could eventually fall under rent-control laws. That would chill the incentives for developers to build more homes in a state where a host of public policies has already undermined the economic incentives that encourage building.
Returning to a statewide rent-control regime would be a regression to poor economic thinking. Investments in rental units would lose their value, and worse than inhibiting new construction, it would likely also decrease the number of rental properties available on the market. Owners just might decide to sell the homes they’re leasing or convert apartments into condominiums that require mortgages.
Real life examples from California cities show how rent control reduces housing supply. A study by California State University, Sacramento, and the Sacramento Regional Research Institute examined the effects of rent control in two cities over two decades. They determined that rental housing supply in Santa Monica fell by more than 8.7 percent, and by almost 7.5 percent in Berkeley.
Tenant groups argue that high rents in San Francisco, Los Angeles and elsewhere across the state prove that Costa-Hawkins should be repealed. But they’d be wrong. Rent control was not eliminated by Costa-Hawkins, it was merely restricted. There is still plenty of rent-control housing in this state. Roughly 85 percent of rentals in Los Angeles are still regulated by the city’s rent-stabilization ordinance, says the mayor’s office.
Costa-Hawkins wasn’t enough to incentivize new building anyway. Wary developers didn’t see it as a green light because they were concerned that any new units would eventually come under rent-control. Their concerns were justified.
California’s high rental costs are a factor in a housing shortage that’s so gaping that, according to the Legislative Analyst’s Office, another 100,000 housing units must be built each year in addition to the 100,000 to 140,000 already being built. Freeing up cities to impose new rent control laws is not a solution to the cruel housing shortage and painfully steep rents.
[AOA: Please make a copy of this article and send it to every politician you know. Go to www.assembly.ca.gov/assemblymembers to find the person who represents your area. Thank you for supporting the industry!]