The Negative Possibilities of Rent Control
November 13, 2018
1 - Because we won prop 10, single family homes are currently protected by state law. However, everyone should be concerned the City would even consider price controls. The property values of many properties, including single family homes, it could go down by 20% to 50% overnight.
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2 - Rent Control will negatively affect Glendale finances. Declining values will adversely impact funding for Glendale schools and city services. The property taxes will go down accordingly and the City and school revenues will be drastically reduced, hurting Glendale and its schools.
3 - Rent control will make it harder to find housing in Glendale. As financial flexibility is restricted, housing stock is removed from the rental market making housing less available. About 15 % of property owners are expected to convert their apartment units to condos and another 15% may use their property for Airbnb or Verbo. This will cause a 30% reduction in inventory which pushes rents up.
4 - Investors and builders will avoid Glendale, which also causes low inventory and risks high rents.
5 - Landlords who had not raised rents in years would have no option other than to raise rents every year like clock work, (just like in San Jose, Los Angeles, Ca) to avoid a massive drop in property value and flexibility.
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6 - People whose retirement depends on their property will be greatly hurt.
7 - Rent control will make rentals in Glendale more expensive. When comparing buildings that are currently subject to rent control in the City of Los Angeles, a two-bedroom unit in rent-controlled Los Angeles costs on average over $1,500 more a year than in Glendale. Cities with rent control such as Santa Monica, West hollywood, Silver lake, etc. have significantly higher rents than Glendale.
8 - According to economist.com economists almost unanimously view rent controls as harmful and self-defeating. A recent study of San Francisco by Rebecca Diamond and others at Stanford University found that rent control reduces the supply of rental housing, because landlords sell properties for owner-occupation instead.
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9 - If rent control is passed, the majority of new landlords will have serious financial consequences and many may go bankrupt. We could see an increase in foreclosures in Glendale.
10 - Once rent control is passed it is almost irreversible. Damage is done to the city of Glendale population.
11 - If landlords of single-family rentals are not allowed to collect rents that reflect the real costs for maintaining a property, then property maintenance will be the first thing to go. This will have a trickle down affect on home values and aesthetics in the surrounding neighborhood.
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If rent control is passed, the majority of new landlords will have serious financial consequences and most probably go bankrupt. We could see many foreclosures in Glendale. Once rent control is passed it is almost irreversible. Damage is done to the city of Glendale population.
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But there are alternatives:
The city should work with housing providers to find a way to move forward. Rent mediation and mandatory lease offerings are viable solutions.
The City of Glendale can meet with landlords and tenants to solve a few isolated cases, instead of endangering 200,000 residents because of the loud complaints of a few.
Utilize Measure S funding to create a direct subsidy to support tenants in need. Measure S was just passed with $30 million revenue for the City of Glendale, which the city can use to provide low income housing to fix the rent issue at its root.
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So if you want to be in control of your property and NOT let the City of Glendale take your rights, then attend the City Council Meetings at 613 E Broadway Blvd Glendale.
I also encourage you to email and call the council members your concerns: (818) 548-4844
Zareh Sinanyan - Zsinanyan@glendaleca.gov
Paula Devine - Pdevine@glendaleca.gov
Ara Najarian - Anajarian@glendaleca.gov
Vartan Gharpetian - Vgharpetian@glendaleca.gov
Vrej Agajanian - Vagajanian@glendaleca.gov