Midterm Elections are upon us and it’s time to hit the voting booths! TV screens are flooded with “vote yes” and “vote no” ads, and campaign banners can be found in front yards and social media pages across the nation. This is the time for people to rally and stand behind what they believe. Now is the time to make sure your voice is heard. In the real estate market, one question stands out in the deluge of information. What is the deal with Proposition 10?
This midterm election, the outcome of Proposition 10 will affect a massive amount of Californians. In the case that it passes, It will give cities the go ahead on expanding rent control, repealing the Costa Hawkins Rental Act.
Southern California News Group makes the argument that expanding rent control will bring down new development. The two major groups that are not opposed to this change are the California Republican Party and the California Chamber of Commerce. On the other end of things, AIDS Healthcare Foundation has given millions of dollars in support and L.A. Times has given full endorsement to Prop 10, and on top of that, they have full support from the democratic party. This is a clash between two powerful sides ready to square up in the ballots.
To make things more clear, voting "Yes on 10" would mean that cities can pass laws limiting rent increases, allowing families with smaller incomes to afford housing without spending their whole paycheck on rent each month.
If you vote "No on 10" that means you believe that owners can do what they want with their property. On the business end of things voting “No’ will keep a competitive shifting market. The reality is that things are going to cost more than others. Economists believe that if landlords can't change the market rate, then they are more likely to contribute to a rental house shortages.
If there is no supply for the demand of housing then rent will go up, but if development is pushed and supply is increased then rent will go down, making a healthier market. Economists believe that owners will take their properties off the market and turn them into Airbnbs and condos, contributing to a rental housing shortage.
Proposition 10 can be good for renters and dangerous for tenants. In this upcoming vote, the outcome could have a dramatic impact in the lives of thousands of Californians. If the vote swings in the favor of abolishing the Costa Hawkins Rental housing act, you may see a lot of unhappy tenants and a lot of happy renters.