Is Rent Control the Answer

Housing advocates clamor for regulation, but landlords and the real estate community may hold more sway. Don’t look for tightened rent regs just yet.


Published:

Megan Small

 

When people talk about rent problems in the Bay Area, they’re usually referring to San Francisco and its recent convulsions of gentrification. But there’s another crisis brewing in the East Bay that has gone largely undetected.

“I’m sweating,” said L, a longtime renter in Alameda who requested anonymity for fear of retribution from her landlord. “By the time I pay my rent, pay my utilities, there’s nothing left.”

Forced out of work by a serious illness, L gets by on disability benefits, but she’s not sure how much longer that will be possible. In the last two years L’s landlord has increased the rent three times—first by $50, then by $75, and most recently, by $100.

L’s personal crisis is a direct byproduct of the larger rental crisis in San Francisco. As the tech boom sends rents in the city through the roof, waves of less-affluent residents have turned to the East Bay in search of cheaper homes. Landlords are responding to the rising demand with increased rents. It’s not a complicated pattern.

In some Alameda County cities—Berkeley, Fremont, Hayward, Oakland, and San Leandro—tenants have rent stabilization that ranges from partial regulations to bona fide rent control. But it’s a different story for Alameda, Albany, Emeryville, Dublin, Livermore, Newark, Piedmont, Pleasanton, and Union City, where rent stabilization simply doesn’t exist. In Alameda, where roughly 37,000 residents rent their homes, lower-income and fixed-income residents are starting to feel the pinch of rent increases.

“People are talking about paying up to $2,000 for a two-bedroom apartment,” said Laura Thomas, the director of Renewed Hope Housing. “That may sound cheap in San Francisco, but in Alameda there are very few people working in the tech industry who make those kind of salaries. Incomes are flat in Alameda, as they are in most of the Bay Area.”

Thomas recently launched a rent survey to collect data from tenants throughout the city. Although it’s still in its infancy, the survey is already painting a picture of a city where tenants feel mistreated by landlords who fail to perform building maintenance, refuse to return deposits after evictions, and raise rents unexpectedly to push out unwanted residents. Thomas’ survey is building an argument for implementing rent control on the Island.

But rent control doesn’t sit well with everyone, particularly real estate firms and landlord advocates who claim that the consequences of rent stabilization are far from a clear-cut win.

“I don’t want to sound pollyannaish about this—there’s always a need for decent amounts of regulation,” said Gregory McConnell, a business consultant and the CEO of the Jobs and Housing Coalition, an Oakland nonprofit business advocacy group. “The question is, what form does it take, and what are you trying to accomplish?”

He favors a balance between the total restriction of rent increases and the complete absence of regulations. In Berkeley, he said, where ordinances prevent landlords from passing rent increases until a unit is vacant, it’s extremely difficult for landlords to raise funds for maintenance and capital improvements, which also has an unintended effect on the demographics of West Berkeley’s landlords.

 “If you have punitive rent control, larger landlords can afford to hire consultants to take care of their interests, but the smaller ones, often minorities, can’t afford to do that,” McConnell said. “In Berkeley, as rent control programs became tighter and more onerous, the smaller, historically African-American landlords couldn’t afford lawyers, so they threw up their hands and sold their buildings.”

McConnell said that the decline of African-American landlords in Berkeley also led to a decrease in the number of African-American renters.

“Who is more likely to rent to a small minority family that maybe has a blemish on their credit?” McConnell said. “Is it going to be the large landlord that uses rent formulas and doesn’t have personal interactions with tenants? Or is it going to be the small mom-and-pop operator run by minorities?”

But even as landlords cite Berkeley as a cautionary tale of rent control run amok, Island housing advocates are comparing Alameda’s landlords to tyrants running personal fiefdoms. Marjorie Roacha, the director of the Eden Council for Hope and Opportunity Housing, a Bay Area fair housing agency, said that while her organization takes a neutral stance on rent control, she is alarmed by the behavior of Alameda’s landlords.

“I look at these landlords as being poster children for rent control,” Roacha said. “If they keep abusing their tenants, there’s going to be a backlash, and right now, it’s pretty heated in Alameda.”

The issue is definitely heating up.

In part, that’s because housing advocates fear how tenant-landlord difference will be resolved in the aftermath of city funding cuts to ECHO Housing educational programs and its fair-housing program, resulting in the city’s Rent Review Advisory Committee shouldering the responsibility. The committee is a volunteer board of homeowners, renters, and property owners—a less-than-ideal forum for addressing and settling rental issues, housing advocates say. Councilmember Stewart Chen acknowledged the committee is constrained but said even without legislative muscle, its hearings have been effective. It does not, however, appear to review many cases.

Additionally, housing advocates have been disappointed by the housing element of the city’s general plan. It skirts a nearly 40-year ban on multi-family housing in Alameda established by Measure A but falls short of demand in the city, they say.

“The goal of [the housing element] is to stabilize housing for lower-income to moderate-income people, so it requires you to do everything you can to hold down the market rate for housing that you have,” Thomas said. “In other words, if you’ve got apartments that are affordable to people, and they’re being priced out, then you need to come up with programs to deal with that.”

Landlords and real estate agents largely agree that Alameda—along with the rest of the Bay Area—is facing a dwindling supply of cheap housing for middle-class families and that increasing and diversifying housing stock is part of the solution. But they also recognize that for the short term, at least, housing markets in cities like Alameda will be at the mercy of simple economics.

“We have an increase in people who want to come and live in Alameda,” said Anne DeBardeleben, the director of the Alameda Association of Realtors. “So our demand continues to increase, whereas our supply is very low … in addition, there’s an extraordinarily low turnover rate, so people who come are staying.”

Councilman Chen noted the city has created affordable housing, including Jack Capon Villa, an affordable multi-family housing project for adults with developmental disabilities—for which 500 individuals are on a waiting list for the 18 available units. Disabled residents represent another constituency that’s unable to move and stuck in limbo with anxiety over potential rent increases.

Realtors like DeBardeleben acknowledge that rents are rising rapidly, which can pose difficulties for people seeking affordable housing. But they argue that rent control is not the right solution. DeBardeleben said rent control could actually trigger spikes in housing costs by reducing the number of available units on the market.

“One thing I’m absolutely sure of is that the pressure on housing markets in the Bay Area would not be made better by more rent control,” McConnell said. “We blame a lot of things on greedy landlords, but it only stabilizes prices for people who are already in the units, and they’re the lucky few.”

Housing turnover in Alameda is low, according to DeBardeleben, which worries affordable-housing advocates who fear how demographics of the city’s homeowners will be affected.

“It’s almost impossible for a young family to find a starter home in Alameda,” said Douglas Biggs, the executive director of the Alameda Friends Collaborative, which provides housing support for Alameda’s homeless. “And it’s absolutely impossible for a young family that doesn’t have medium or high income to find housing.”

Biggs has also noticed that some benevolent Alameda landlords inadvertently employ harmful rent polices. “Some of these landlords haven’t raised rent for years thinking that they’re being nice, but then suddenly they raise it all at once, so that defeats all that good will that’s built up,” Biggs said. “It would be better if they raised it little by little each year.”

“In the Bay Area we’re rapidly running out of the dream of the single-family home with the white picket fence,” McConnel said. “But we can be talking about elegant density with multi-family housing. What Alameda needs to do is grow their housing stock, and they need to grow it quickly.”

Despite all this housing hubbub, not much is happening on rent control or the affordable housing issue from a governmental standpoint. In June, the planning board recommended the city council create a task force to study whether people are being displaced by rising rents, stopping far short of taking a position on rent control.

Laura Lane, director of the Housing Practice at the East Bay Community Law Center, said that unlike its neighbors, Alameda has never experienced a strong political movement centered on rent control or housing. “There hasn’t been the political will in Alameda to have additional tenant protections,” Lane said. “Both Berkeley and Oakland’s rent control and eviction control ordinances are the results of long battles.”

Alameda was the scene of several housing battles during the first dotcom boom in the 1990s. Alameda landlords, encountering a wealthy new tech class seeking apartments, raised rents by $300 to $400 a month and practiced wholesale evictions to rid their buildings of lower-income residents. Renewed Hope was founded in the midst of a squabble between activists and the city over rehabilitating hundreds of units for housing in the West End’s Bay Port neighborhood.

Since then, Alameda’s housing activists have melted away. Thomas said her organization has 15 active members, a far cry from the hundreds of citizens who joined the protests during the 1990s. Thomas blamed this decline on a growing indifference felt by Alameda homeowners toward people who can’t afford to live in their city.

“Why would you want more people in your paradise?” Thomas said.

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