For decades, Sacramento has been proud of its reputation as an affordable corner of California, accessible to a cross-section of people unlike the exclusive, uber-rich enclaves along the coast. But a recent report on the housing market puts the capital city’s trajectory in alarming perspective.
In the past 12 months, the median rent for a two-bedroom apartment here has shot up a whopping 8 percent — three times faster than in any other major metropolitan area in the United States, according to Hotpads, a subsidiary of real estate tracking firm Zillow.
Developers put more stock in a report from Yardi Matrix that shows Sacramento has actually fallen to sixth place in rent growth. Still the trend of renters finding themselves priced out is clear and it is a call to action. It’s time for the powers that be — members of the Sacramento City Council, developers, SEIU-backed tenants’ rights groups — to stop waffling and squabbling, and come up with a legitimate plan to address the affordable housing crisis.
A public workshop planned for Aug. 9 is a good place to start. At it, Mayor Darrell Steinberg will outline the core of an ordinance that could increase affordable housing construction and provide immediate help for desperate renters. It’s a promising plan, although the devil is very much in the yet-to-be-hammered-out details.
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Developers and tenants’ rights groups owe it to the people of Sacramento to come to the table in good faith and help Steinberg work out a viable compromise. And City Council members owe it to their constituents to worry less about campaign contributions and more about trying to pass the best ordinance possible.
If not, Sacramento’s future is sure to be one of stalled housing construction (except for the priciest residences), skyrocketing rents thanks to the influx of Bay Area residents and a lot more homeless people. There’s also a good chance voters might decide to repeal the Costa-Hawkins Rental Housing Act in November, freeing cities to expand rent control, setting up a draconian local ballot measure in 2020.
What Steinberg is proposing is more palatable.
It includes using money from Measure U — assuming voters agree to permanently raise the city’s sales tax by 1 cent in November — to help refill the city’s largely empty housing trust fund. The money would be used to help subsidize affordable housing projects. Steinberg also wants to create a “housing czar” who would determine how that money would be spent, in addition to distributing rental subsidies to people in danger of losing their apartments and helping coordinate initiatives to reduce homelessness.
Developers, meanwhile, would have the chance to streamline the city’s cumbersome permit process and perhaps waive fees that make construction more costly. That last point could prove a hard sell, though. Housing advocates are still upset over the city’s decision in 2015 to waive fees for high-density, infill housing in the central city — fees that would’ve gone into the trust fund.
But, by far, the most contentious part of the proposed ordinance is on tenant protections, including what Steinberg calls “rent stabilization” and developers unfairly call “rent control.” A 5 percent cap would be put on rent increases for low- and middle-income tenants. The cap would only be available when the vacancy rate is low and wouldn’t apply to new construction, but would as those buildings age.
Steinberg also wants an “informed consent” provision for evictions, which isn’t as complicated as the legal process for “just cause” evictions, but would force landlords to provide a legitimate reason for terminating a lease. Just wanting to charge $300 more a month in a hot market won’t count.
Developers in the Citizens For Affordable Housing coalition are against both tenant protection provisions, predicting the doom and gloom of construction grinding to a halt. Instead, they’d rely on rent subsidies from an yet unnamed source and push people to sign longer leases.
But that’s not enough. Rent stabilization is not rent control, and if there is a way, even with Costa-Hawkins still in place to help the neediest Sacramentans keep a roof over their heads, then the city should do it — and developers should support it.
Yes, increasing supply is the answer to the affordable housing crisis. But it’s not the only answer.