Housing Problem Requires More Supply
You know a problem is bad when it makes bipartisan enemies. These days, San Diego’s housing crisis has everyone from developers and environmentalists as well as business and labor leaders seeking solutions for smarter growth in our region. And while not everyone may agree on how we get there, everyone agrees we need more housing in California.
But there is a major roadblock to this progress rearing its ugly head on our ballot. California’s Proposition 10 and National City’s Measure W will be decided by voters this November. Both claim to address the housing crisis but neither measure creates a single unit of housing and both will actually increase the cost of housing while burdening taxpayers. Policies like these seek to increase the number of rent-controlled units or limit landlords’ ability to change rents, but according to the California Legislative Analyst’s Office, “neither of these changes would increase the supply of housing and, in fact, likely would discourage new construction.” If policies like Prop. 10 and Measure W pass, there may be no pulling our limited housing supply back from the brink of unaffordability.
📷Getting homes built in California is hard. Even small and medium-sized residential development is a major investment of time and money but building more is absolutely essential to improve our housing market. Our high cost of living is due to a simple imbalance: A lot of people want to live here but there are not enough homes for them. When companies like Google announce they are adding hundreds of new jobs to our region, further demand for homes is created. This leads to more competition for existing units, longer commutes, more traffic and less time and money for residents.
The solution to bringing down our cost of housing is to make it easier to build so we can add more homes. Regulatory requirements, impact fees, citizen lawsuits, high labor costs and the rising costs of materials all contribute to high housing costs. We must continue to address these root causes so we can achieve an influx of new housing. Any number of changes, including smarter planning for growth and streamlining the project approval process, could help address our housing shortage. Rent control policies do not accomplish this. They limit choice for renters and landlords and will make our housing crisis worse. Measure W and Prop. 10 propose flawed plans that will actually increase rents and make it harder for new renters to find an apartment.
It may seem like a win for people looking for lower rents, but the real impacts only worsen our crisis. Study after study, including a 2018 paper published in the National Bureau of Economics, has found rent control reduces the total number of rentals available, which can make neighboring market-rate units more expensive, and results in fewer rent-controlled units than anticipated as owners convert their property to condos and other types of housing not subject to rent limits.
This exact outcome has occurred in San Francisco and elsewhere. Rents get more expensive for people already paying too much.
Under rent control, low-income residents in National City would be hit the hardest because Measure W allows apartments to automatically go to people with higher credit scores and income instead of prioritizing those homes for deserving groups like seniors, veterans, teachers and working families that need affordable housing. This policy blocks new renters and locks in existing tenants.
The measure also includes so-called “just cause” provisions, meaning that landlords will face new challenges in dealing with difficult tenants. Measure W jeopardizes the safety of our neighborhoods by making it harder to evict tenants who are engaged in unsafe or criminal activity. Measure W creates significant risks for our community but does not include sufficient protections for neighborhoods. Instead of new public safety policies, Measure W creates an expensive bureaucracy to impose its requirements on landlords with no protections against problem tenants.
Rent control is not a new or creative idea. Decades of history confirm a clear fact: Rent control has done nothing to help housing affordability in other California cities like San Francisco or Santa Monica. In a 2016 report, the Legislative Analyst’s Office found that rent control proposals like Measure W do not help housing affordability and, in fact, make housing more expensive.
In San Diego County, bipartisan groups are clamoring for more housing. These diverse groups understand that keeping our economy strong means adding jobs and providing new and attainable housing options for a growing workforce. Rent control policies have been consistently shown to slow or even stop new construction and reduce the value of existing homes. In San Diego, supporting those outcomes in the midst of a housing crisis is like running your sprinklers during a downpour.
We need less regulation and less government intervention. We need to build our way out of this problem.
If rent control supporters win these two battles, our region will very well lose the housing crisis war so many are fighting.
Alan Pentico is executive director of the San Diego County Apartment Association and a resident of the city of San Diego.