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John Davis's avatar

Good points. Glad you are touching on these idiotic rental laws in LA - and across the state. As a real estate multi-unit investor and owner in CA, I've had to drop development projects here in the state that would have added new housing units - but rather, invested in other states. I love CA, but it is a shame the state/local governments are tying the hands of landlords/investors ensuring we can't pencil our projects. Excessive rent control laws like LA just passed. Threat of vacancy law - which would put us out of business completely (look up 'rental vacancy law'). We also sold a multi-unit building and divested from CA and reinvested it outside CA due to fear of yet more onerous CA anti-owner laws. If CA wants more units, affordable housing and less homelessness, stop treating investors/developers/landlords like the enemy. The excessive rent control laws are a short-term bandaid, but ultimately a long-term disaster. Existing housing units go into disrepair (as owners can't afford to fix them up), new units aren't build (as the return is limited to below the rate of inflation) and development money leaves CA. We end up with slums like NYC in the 1970's which enacted the same short-sighted laws CA is enacting today. Tenants complain about rents going up and paint the landlord as greedy. But note that owner's insurance rates have gone up 12-18% year after year, utilities going up 13-16%, vendor fees and materials going up 8-12% a year. And yet, LA caps rents at 3%. CA is 5% plus CPI. Do the math. That is unsustainable. Any business with those numbers will eventually fail. Then folks complain there isn't enough housing. CA, if you want housing, stop restricting the incentive to build and maintain it.

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