Nancy
Buttanda, 68, has watched in horror as her rent check eats up more
and more of her fixed income. The rent on her apartment in Federal
Way, Wash., has increased annually at least $100 a month for three or
four years, she says, and her landlord rarely makes repairs. She now
pays $1,245 a month for rent, water and trash, while living on
pension, Social Security and disability payments that amount to
around $3,300. A recent auto accident stuck her with $400 car
payments, and after paying for Medicare, electricity and everything
else, she’s often left with less than $300 each month for
necessities.
Because
she struggles with mobility due to multiple knee replacements,
Buttanda dreads the idea of moving and doubts she’d be able to find
another apartment in her price range with an elevator. She applied
last year to county-subsidized affordable housing developments that
cater to seniors, but was told she was over the income limit—by $80
a year.
“I
feel like I’m out of options,” she says. “I’ve never been so
scared in my life.” Federal standards set the threshold for
“affordable housing” at 30 percent of a family’s income, a
threshold that Buttanda’s rent exceeds. One in four U.S. households
spends more than half of its income on rent. In 1985, the median U.S.
family spent just 19 percent of its income on housing.
In
the 40 years preceding the Great Recession, rents grew twice as fast
as incomes. Then came the 2008 housing crash, in which more than 10
million families lost their homes to foreclosure. Less than one-third
are likely to buy again, thanks to wrecked finances and credit
scores. As a result, more U.S. households are renting now than at any
point in at least the past 50 years. Due in large part to predatory
lending, Black and Latino households were more than 70 percent more
likely than white ones to lose their homes in 2012, and they’re now
nearly twice as likely to be renters. Rent affordability is also
worse in communities of color: Median renters in predominantly Black
neighborhoods spend 44 percent of their income on rent, and renters
in predominantly Latino communities spend 48 percent.
As
this nationwide housing affordability crisis becomes harder to
ignore, Washington state is one of several places where advocates are
launching a renewed push for rent regulation, thanks in large part to
activism by tenants like Buttanda. While a scattering of cities and
towns in four states—California, Maryland, New Jersey and New
York—and Washington, D.C., have rent control laws in place, 35
states, including Washington, prohibit or limit local governments
from regulating rent hikes. But legislation introduced by Democrats
in Washington in January would repeal the state’s ban, in effect
since 1981. As a member of the progressive advocacy group Washington
Community Action Network (WCAN), Buttanda hopes to convince a newly
Democratic-controlled state legislature that curbing skyrocketing
housing costs should be a top priority.
Progressive
legislators in Illinois also have pending legislation that would
repeal restrictions on rent control.
And in California, a
first-of-its-kind “national renters day of action” in September
2016 helped propel rent control to victory at the ballot box in two
cities and launch new campaigns in at least seven others. While rent
control remains a controversial measure among mainstream Democrats
(many of whom receive hefty donations from real estate lobbies),
these campaigns are attracting support from a broad swath of local
unions and community organizations, as well as socialists who see
rent control as the first step toward weakening the market’s grip
on a basic human need.
“Rising
rents aren’t an act of God; they’re an act of price gouging,”
said Kshama Sawant, socialist Seattle City Council member, to a
cheering crowd during a July 2015 debate with local developers.
On
Dec. 5, 2017, hundreds of members of WCAN, tenants’ rights groups
and local unions gathered at the annual meeting of several state real
estate organizations in Seattle. The renters were there to crash the
landlords’ party.
Inside
the Washington State Convention Center, a series of demonstrators
stood up, one by one, and interrupted the meeting to speak about
rising homelessness and the dire need for affordable housing.
Event staff quickly escorted the demonstrators out.
Outside,
State Rep. Nicole Macri (D) announced her plans to introduce a bill
to overturn the ban on rent regulation, to cheers from the crowd. “We
cannot waste this opportunity,” Macri said of Democrats’ newly
won control of the state house. “Up until this point, the
legislature has been nibbling around the edges.” In recent years,
Washington state and the city of Seattle have both passed a series of
tenant protections that fall short of rent control. In 2016, for
example, the city unanimously passed legislation proposed by Sawant
that caps the move-in fees for a new apartment at the equivalent of
one month’s rent.
But
that legislation is being challenged in court by several major
landlords, who charge that it violates their free speech and due
process rights. Housing advocates expect a similar challenge to
current efforts at rent regulation. “The landlord associations have
fought any and all tenants’ rights legislation at the local and
state level,” says Xochitl Maykovich, political director for WCAN.
“We decided to protest their convention to make the point that
we’re not going to roll over.”
The
history of rent control bans also involves a backlash by real estate
lobbies. A wave of militant tenant organizing won the passage of new
rent control laws in four states and dozens of cities from 1972 to
1985. Spooked by these reforms, real estate interests quickly
organized a powerful countermovement that pushed through a slew of
so-called preemption laws, which allow states to overturn or prevent
municipal-level progressive policy, beginning in the 1980s. At the
center of these efforts was an old bête noire of progressives: the
American Legislative Exchange Council (ALEC), which writes sample
right-wing legislation. State prohibitions on minimum wage hikes and
fracking bans have received recent attention, but ALEC’s
little-noticed “rent control preemption act” also appears to have
been quietly adopted in state after state.
Even
where rent control hasn’t been banned outright, landlords have
successfully chipped away at protections. In California, where 13
cities passed rent control between 1972 and 1985, the real estate
lobby and sympathetic legislators launched several unsuccessful
efforts to ban the measure at the state level—both through
legislation and through a proposition that voters defeated 65 percent
to 35 percent in 1980. A 1987 report by the California Association of
Realtors claimed that the industry had spent over $14.2 million to
fight rent control. Finally, in 1995, a rightward shift in state
politics provided an opening for passage of the Costa-Hawkins law,
which prohibits rent control on apartments built after that year and
allows landlords to hike rents in older buildings once existing
tenants leave.
The
law also restricts the types of units covered by rent control, a
major issue in areas such as Sacramento County, where the largest
private landlord is the Wall Street-owned Invitation Homes. The
company bought up tens of thousands of foreclosed homes nationwide in
the wake of the financial crisis, and the single-family homes it now
rents out are exempt from all local rent control laws in California.
Renita
Barbee was forced to leave her single-family home in Los Angeles last
year when Invitation Homes, which has a heavy presence in the city,
hiked the rent from $2,120 a month to $3,000. After Barbee attended a
protest against the company organized by a local community group,
Invitation Homes informed her that the initial increase had been a
“mistake” and the new rent would be just $2,320 a month. But for
Barbee, at the time the only wage earner in her household after her
mother’s recent death, that amount was still out of reach—nearly
half her income. “If companies like Invitation Homes keep these
rent increases up, we’ll all end up on the street,” she says. “We
need rent control for single-family homes.”
California
housing rights groups are waging a multi-pronged campaign to repeal
Costa-Hawkins and allow cities like Sacramento and Los Angeles to
enact stronger rent control laws. A bill to that effect was
introduced in the state assembly in 2017 but was slow to attract
support, even from Democrats. In January, the bill died in committee.
The
Alliance of Californians for Community Empowerment (ACCE) and two
other groups filed a proposed ballot initiative in October 2017 that
would allow voters to repeal Costa-Hawkins. To get the referendum on
the November 2018 ballot, the groups will have to gather 365,800
signatures by April 24. They kicked off a signature drive in early
January.
To
win, advocates will need to convince voters that rent control works.
An
oft-cited 1992 poll by the American Economic Association found that
93 percent of its members agreed, “a ceiling on rents reduces the
quality and quantity of housing.” That helped cement the
conventional wisdom that rent control actually hurts tenants by
discouraging developers from maintaining existing properties or
building new ones. In 1999, Forbes named
rent control (along with collective bargaining) one of the “dumbest
ideas of the century,” citing this rationale.
But
research examining the effect of rent control on displacement has
yielded different conclusions. In 2015, the Urban Displacement
Project—a collaboration between researchers at UC Berkeley, UCLA
and Portland State University—looked at the average rate of
displacement in hundreds of gentrifying California neighborhoods.
Rent control was a common factor among those that experienced less
displacement than expected, based on the rate of gentrification and
other risk factors. The researchers also noted that the actual
numbers on housing production belie the claim that rent control
stunts construction. Between 2007 and 2013, the six cities in the Bay
Area with rent control produced more housing units per capita than
the cities without it.
Could
rent control discourage landlords from making repairs? Amy Schur,
campaign director of the ACCE, has little patience for this argument.
“Landlords have an obligation to keep their properties up to code,”
she says.
“The state constitution even guarantees a reasonable rate
of return, so landlords can petition a rent control board to raise
rents in order to make repairs.”
Another
argument holds that high rents are the result of constrained supply,
and building more housing will naturally lower costs without
government interference. But WCAN’s Maykovich doubts that the
market will ever produce housing that’s affordable for senior and
disabled renters like Nancy Buttanda. “I hear a lot that if we just
fix supply, then everything will be magic and life will be great,”
says Maykovich. “But there will always be landlords trying to gouge
their tenants.”
Proponents
of new, market-rate housing often suggest that, as these apartments
age, they will naturally fall in price and become available to
lower-income households. A 2014 study suggests that this process,
known as “filtering,” occurs at an annual rate of about 1.9
percent. But in tight urban housing markets, especially in
neighborhoods made to appear more desirable by luxury condo
development, this process may happen much more slowly. Researchers at
Berkeley’s Institute for Governmental Studies concluded that
“filtering is not enough” to prevent displacement. More
effective, according to the study, is building new subsidized
housing.
In
December 2017, more than a dozen organizations, including WCAN,
convened in Washington, D.C., for a “Peoples’ Hearing on
Housing,” where they outlined a slate of more far-reaching demands.
In addition to controls on rent, the coalition called for new federal
investment in public housing, a $200 billion “anti-displacement
fund” for affordable homes in gentrifying cities, zero-interest
loans for communities of color where predatory lending has
historically run rampant, a $350 billion climate resilience fund to
finance energy efficiency upgrades to homes, and a national tenants’
bill of rights.
In
the meantime, however, Congress has been gutting funding for public
and subsidized housing programs for years, a trend the Trump
administration has moved to continue. Many housing advocates see rent
control as a measure that’s winnable in the short term, without
backing from hostile federal agencies.
“Pushing
to repeal the ban on rent regulation will allow us to have a broader
conversation about housing affordability throughout the country,”
Maykovich says. “Ultimately, we need to be calling for increased
investment in housing from all levels of government.”
>> The article above was written by Rebecca Burns, and is reprinted from In These Times.
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