Destroying CA’s Housing Supply, One Step at a Time
It is now official. Sacramento is going out of its way to harm your bottom line even more. After years of socialist-style experiments on housing supplies, the state is making the housing situation even worse. Prepare for even higher rents in the years to come as Governor Newsom signed the bill into law.
Rent control bill AB 1482 places a cap on the increase in rent in the state.
Of course, making the scheme even worse is the fact that the state is in a self-imposed housing shortage. A combo of environmental and zoning restrictions means that the state is adding far fewer housing units than we need. As a state of almost 40 million people, this is simply unacceptable.
Combining Housing Restrictions with Price Controls is a Recipe for a Shortage
In fact, CA ranks as 49th of 50th nationwide in housing production, according to Politifact. Years of Democratic control in Sacramento and in city halls across the state have simply made the problem worse. The combination of a shortage plus price controls will only make the issue much bigger in the years to come.
Reason reported on the terrible policy. The article cites a recent study, that found in part that:
“while rent control prevents displacement of incumbent renters in the short run, the lost rental housing supply likely drove up market rents in the long run, ultimately undermining the goals of the law.”
In parts of CA that are actually growing, this doubles the issue. Restrictive housing markets such as San Francisco require a balance to pricing. Soviet-style price controls do the exact opposite. Mark my words– there will be a sharp decrease in quality housing in the state over the next decade relative to needs. Just what we don’t need at the worst possible time.