Fact check: Can landlords hike rent by 15% if California voters pass Proposition 21?

Voters will soon decide on a ballot measure for the second time in two years that would let California cities establish rent control on more housing.

Claim: But landlord groups, including the California Apartment Association, argue it’s inaccurate to herald Proposition 21 as true rent control because owners could still raise housing prices by up to 15%.

It’s an unusual point coming from a campaign representing landlords who generally don’t want any rent limitations, but it’s an argument meant to weaken support for the initiative.

Rating: Mostly true.

Details: Led by the Los Angeles-based nonprofit AIDS Healthcare Foundation, the tenant activists pushing Proposition 21 say the measure would prevent homelessness by stabilizing rent prices and protecting financially vulnerable families.

Proposition 21 would revise a 25-year-old law that blocks local governments from freezing rent prices on buildings constructed after Feb. 1, 1995 and single-family homes and condos. The law, called the Costa-Hawkins Rental Act, also prohibits local jurisdictions from dictating new rent prices once a unit is vacated.

A previous tenant-protection initiative, Proposition 10 in 2018, would have repealed the law entirely and allowed local rent control ordinances. After the measure flopped at the ballot box with 59% of voters rejecting it, advocates decided to include some wiggle room for landlords in Proposition 21 to appeal to more voters.

First, they included an exemption for small landlords who own up to two single-family homes. The law also wouldn’t apply to new homes constructed in the last 15 years.

And owners could still raise rent prices by 15% once a tenant leaves.

A landlord could impose that price hike when a new renter moves in, or spread it out within three years, said Yes on 21 campaign spokesman Ged Kenslea.

The 15% increase on an emptied unit would let landlords update outdated rent prices, the campaign said, but wouldn’t harm the renters Proposition 21 aims to protect.

“Prop. 21 will bring fairness to our housing markets and stable secure homes for millions of Californians,” an ad for the measure includes.

Still, No on Prop 21 campaign spokesman Steve Maviglio said it’s inaccurate to package the measure as rent control.

“For them to say this is going to keep people in their houses, what are they going to do when (renters) have a 15% rent increase,” Maviglio said. “It’s bogus to sell this as rent protection.”

This story was originally published October 16, 2020 at 6:00 AM with the headline "Fact check: Can landlords hike rent by 15% if California voters pass Proposition 21?."