Is a Costa-Hawkins Repeal Likely?

We have seen a handful of ballot measures focused on affordable housing in the last few years. The most talked about have been Measure JJJ—which passed in November 2016 and mandates an affordable allotment for new development that requires an exemption to the general plan—and Measure S, which failed in March 2017 and would have halted any development that requires an exemption to the master plan. The newest effort is from Alliance of Californians for Community Empowerment to repeal the 1995 Costa-Hawkins Rental Housing Act. While the effort is only in the petition phase, it looks like a full repeal is unlikely.

“A full repeal does feel unlikely, but it really depends on how they position this and put it into affect over the next few months,” Sturai Yusufi of Commercial Brokers International, tells GlobeSt.com. “They will have a fight ahead of them, no doubt. It seems unlikely because the opposing forces have a lot of interest and investment and capital. I see it making the ballot, and then becoming a debate following that.”

It has been an uphill battle for the previous measures as well. The development community’s opposition is to these measures is generally strong, and there is some concern that a repeal of Costa-Hawkins could result in extreme rent control measures. However, with increasing rental rates and a housing shortage throughout California, support for the measure is also strong. “It is a bit early, but they have a really good chance and a good opportunity for the repeal. They could have a good chance because the demand is so strong, and it is growing,” says Yusufi. “It has been such a continuing conversation, and it is being pushed to the limits. For that reason, they could have a good chance, if they position the conversation correctly over the next few months.”