Editorial: It’s time to end the rent freeze in Los Angeles
Two things are true in Los Angeles. The rent is too damn high And Landlords should be allowed to raise rent.
On February 1, rent-controlled landlords in Los Angeles will be allowed to raise rents for the first time in nearly four years, ending a price freeze on rent-controlled units that the city adopted in spring 2020 to help with hardship. Tenants during the disruptions of the COVID-19 pandemic.
The rent freeze has served its purpose, and it’s time to end it. Proposing to postpone rent hikes for an additional six months, while well-intentioned, is not the way to address Los Angeles’ affordability crisis. The settlement proposal, which allows rents to increase by 4% to 6%, instead of 7% to 9% as originally announced, is a better path forward, as it reduces the price shock for tenants while allowing landlords to recover the increased costs.
The struggle over permissible rent increases is a symptom of L.A.’s chronic housing shortage, which is exactly why the City Council and Mayor Karen Bass must continually push for more, faster, and cheaper housing in L.A. everyone Corners of the city, no Affordable ban Projects Facing local opposition or being captured Possible development Locations are off the table.
Los Angeles has one of the most unaffordable housing markets in the country, that is Driving force Behind the city’s homelessness crisis. some 57% of renters In the greater Los Angeles area, they are rent burdened, meaning they spend more than a third of their income on housing, leaving less money for savings, health care, transportation and other needs.
Low-income renters are under severe pressure due to rising rents. on A quarter of renting families In Los Angeles they pay half their income or more to stay at home. So there are real concerns that rising rents will push families into conditions of overcrowding or homelessness.
However, the rent freeze has placed the burden of the affordability crisis on the shoulders of rent-controlled landlords, which make up nearly three-quarters of the city’s apartments during a period of high inflation, along with rising costs for utilities, trash collection and transportation. Title insurance. During the pandemic emergency, then-Mayor Eric Garcetti only had the authority to halt increases on properties built before October 1978, which are regulated by the city’s rent stabilization law. However, owners of newer units and single-family homes were allowed to raise rents by 10% or more annually, depending on the property.
Los Angeles’ pandemic state of emergency ended in February, along with an eviction moratorium. The rent freeze is scheduled to end in February. Under the city’s rent stabilization ordinance formula, which is based on the Consumer Price Index, the allowed rent increase is 7%, with an additional 2% if the landlord pays for gas and electricity. This will be the highest allowable rent increase since the law was passed in 1979.
Councilman Hugo Soto Martinez proposed postponing the rent increase to Aug. 1 while the Housing Department studies the rent increase formula under the rent stabilization law. City code sets a permissible annual rent increase of 3% to 8% (although landlords certainly don’t have to raise rents at all). But because inflation has been so low for so long, allowable increases have exceeded the CPI in 23 of the past 30 years, meaning rents have been allowed to rise faster than inflation, according to Soto-Martinez.
The wording of the rent stabilization law was created decades ago and it is a good idea to revisit it. But waiting for the study is not sufficient reason to extend the rent freeze for a year and a half after the end of the pandemic emergency.
Councilman Bob Blumenfeld’s 4% compromise, with up to an additional 2% for landlord-paid utilities, is based on the latest Consumer Price Index data and is unlikely to satisfy all tenants and all landlords. But it strikes the necessary balance and should be approved by the City Council.
Los Angeles leaders need to help renters in a highly competitive housing market, which is why strong tenant protection laws have been so important. But they also have an interest in maintaining and increasing the number of landlords in the rental business. Landlords provide an essential service – housing – of which Los Angeles needs more.