Rent Control Legislation Continues to Expand in L.A.

Inglewood and Haywood are two of the most recent cities in California to adopt rent control ordinances in response to the dearth of affordable housing supply. However, they likely won’t be the last. Cities are responding to resident concerns about the rising cost of rents with new rent control or stabilization policies—in many cases temporary fixes before longer-term solution are implemented—after Prop 10, which would have repealed California’s Costa Hawkins Rental Housing Act—failed to pass last year.

“Few people dispute that there is a shortage of affordable housing in California, and many still believe that rent control addresses the issue despite Prop. 10’s demise,” Jennifer A. Bojorquez, a real estate finance attorney at Troutman Sanders, tells GlobeSt.com. “Cities such as Inglewood, which recently adopted a temporary rent control ordinance, have seen an increase in rents of more than 10% in the past two years alone.”

Rising rents is a multi-pronged issue. Many attribute the core of the problem to an extreme supply-demand imbalance. In Inglewood, the construction of a new NFL stadium is also contributing to rising rents. “Some attribute the rent increases in Inglewood to the construction of the new NFL stadium and the new rail line,” says Bojorquez. “While current state law prohibits local governments from establishing rent control ordinances on units constructed after February 1995, cities are still permitted to create rent control on units constructed before such date unless the unit was specifically exempted pursuant to a local exemption for newly constructed units.”