Californians today rejected a rent control ballot measure that inspired and laid bare competing visions of how to respond to the state鈥檚 housing crisis.
Proposition 33, with it at the time the was called by the AP, would have given cities more freedom to limit how much landlords can raise rent. It would have repealed a state law known as the that bars local governments from regulating rent on single-family homes, apartments built since 1995, and units where there鈥檚 a new tenant.
Opponents 鈥� including landlords, realtors and some YIMBY groups 鈥� had argued Prop. 33 would have reduced incentives to build new housing at a time when the state desperately needs it. They also warned that cities such as Huntington Beach that have resisted building affordable housing would intentionally use Prop. 33 to set rent caps so low that they make development impossible.
Supporters of Prop. 33 included tenant groups, unions, the California Democratic Party and the AIDS Healthcare Foundation, the Yes campaign鈥檚 major donor. They said that tenants burdened by the state鈥檚 high cost of living need relief now, and that rent control is a key strategy to fight homelessness and displacement. And they argued that concerns about chilling the housing market are overblown, comparing them to fears raised by businesses that increasing the minimum wage would lead to mass unemployment.
This marks the third time in recent years that tenant advocates have tried and failed to expand cities鈥� ability to enact rent control. Voters rejected similar ballot measures in 2018 and 2020.
鈥�(Voters) understand that the answer to our housing crisis isn鈥檛 more red tape 鈥� it鈥檚 building more housing,鈥� said Nathan Click, a spokesperson for the No on 33 campaign.
Susie Shannon, campaign manager for Yes on 33, said the state had missed an opportunity to check the power of corporate landlords. 鈥淭here will be more tenants displaced, there will be more tenants who become homeless, there will be more who have to move out of their neighborhoods and there will be more who choose to move out of California because they don鈥檛 want to become bankrupt or homeless,鈥� she said.
Shannon also blamed Gov. Gavin Newsom for breaking with the California Democratic Party and lending his name to the No campaign, which she said 鈥渃onfused鈥� Democratic voters.
Legislators like Sen. Toni Atkins and Assemblymember Buffy Wicks, who are known for supporting housing construction, also came out against Prop. 33. So did editorial boards of the state鈥檚 major newspapers, some a sentence in the proposition that would prevent the state from putting future limits on cities鈥� ability to enact rent control.
鈥�(Voters) understand that the answer to our housing crisis isn鈥檛 more red tape 鈥� it鈥檚 building more housing.鈥�Nathan Click, spokesperson, No on 33 campaign
Pitted against these establishment voices was the outrage Californians feel about the state鈥檚 astronomical housing costs. Renters in California than in any other state except for New York, and nearly a third spend more than half their income on rent. Advocates with the Yes campaign, who were , said they were relying on a strong ground game to convince renters that supporting the proposition was in their interest.
The role of the AIDS Healthcare Foundation added another wrinkle to the debate over Prop. 33. The nonprofit, which also bankrolled earlier attempts to overturn Costa-Hawkins, is itself a landlord operating affordable housing in Los Angeles. A Los Angeles Times investigation last year found that it and evicted some over small unpaid debts. Landlords took aim at the group, funding another ballot measure, Prop. 34, seemingly aimed solely at curtailing the nonprofit鈥檚 ability to fund pro-rent control campaigns.
Like other housing-related debates in California, Prop. 33 was also about local vs. state control. In the 1970s and 鈥�80s, progressive cities with growing housing costs and strong tenant movements enacted sweeping rent control measures limiting annual increases across the board, including when new tenants moved in. By passing Costa-Hawkins, state legislators made such vacancy control illegal and prevented cities from adding newer units to their stock of rent-controlled housing. Now, some city leaders want that freedom back.
鈥淲e have millions of people that are rent-burdened and are being asked to address the issue of homelessness,鈥� said Los Angeles City Councilmember Hugo Soto-Mart铆nez, who authored a resolution passed by the council in support of Prop. 33. 鈥淭he conversation has to be about how do we use the levers that we have to ensure that working-class renters aren鈥檛 being displaced.鈥�
But not all do: San Diego Mayor Todd Gloria and San Jose Mayor Matt Mahan were among local leaders who lined up against Prop. 33.
Prop. 33 also raised the question of how California should balance building new affordable housing with preserving units that are already accessible to low-income tenants. The state is seeking to add affordable units to the market while simultaneously losing others because Costa-Hawkins allows landlords to bump rents to market rate whenever a tenant moves out. Meanwhile, any new housing added to the market is not subject to local rent control.
A state law already to 10% per year 鈥� but that鈥檚 higher than most local rent control ordinances, and the law is set to expire in 2030.
鈥淲e have millions of people that are rent-burdened and are being asked to address the issue of homelessness.鈥�Hugo Soto-Mart铆nez, Councilmember, Los Angeles City Council
As housing costs have skyrocketed, a new wave of cities has enacted rent control, including 鈥渄isplacement destinations鈥� like the Bay Area city of Concord, where residents have fled after being priced out of more expensive cities. Costa-Hawkins has limited the number of units those local laws can apply to.
Though Prop. 33 failed, California will likely still see more jurisdictions starting rent stabilization programs within the confines of existing state law, renter advocates say.
That could create momentum for future changes to the law. 鈥淲hen more cities have rent control it will be more logical to repeal (Costa-Hawkins),鈥� said Shanti Singh, legislative director for Tenants Together. 鈥淵ou鈥檝e got to make it an issue for everybody.鈥�
State legislators could choose to pass a more modest revision of the law 鈥� for example, expanding eligibility for rent control to newer buildings but continuing to let landlords raise the rent beyond local limits when new tenants move in.
That was the path San Francisco supervisors planned to pursue if Prop. 33 passed 鈥� one backed by both progressive and moderate Democratic officials in the city.
They could also extend the state鈥檚 current 10% rent increase cap after its scheduled expiration date of 2030, or lower that cap for the buildings the law covers, as in an editorial rejecting Prop. 33.
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