On October 6, the Santa Barbara City Council gave final approval, by a single vote, to a rent control ordinance that caps annual increases at 60 percent of inflation or 3 percent, whichever is lower. I urge readers to look past the good intentions and consider what this measure will actually do.
First, it is unnecessary. California already has statewide rent control. The Tenant Protection Act limits annual increases on most older rentals to 5 percent plus CPI, with a hard ceiling of 10 percent, and it protects tenants from evictions without just cause. Santa Barbara has added a second, far stricter layer, along with a new registry, a rent board, and a bureaucracy whose final cost is still unknown.
The reach of that bureaucracy is remarkable. Every rental in the city must register and pay an annual fee, even when the unit sits vacant. That includes single-family homes, accessory dwelling units, and properties exempt from state rent control. Owners who fail to register cannot collect rent, advertise their unit, raise the rent, or recover their property through a no-fault eviction. In other words, a paperwork lapse could cost a small landlord their entire income.
Second, beware of unintended consequences. Small “mom and pop” landlords cannot absorb rising property taxes, insurance premiums, and repair bills when their rents are frozen near inflation. Many will sell. The buyers are likely to be large corporations with the scale to wait out regulation, and they will not know their tenants’ names or care about them the way local owners do. Owners who stay will be forced to defer maintenance just to make ends meet, and tenants will live with the results. As maintenance falls off, the local contractors we rely on for repairs may become scarcer.
Third, the ordinance punishes the very landlords who have helped keep this city livable. Many of us have kept rents below market for years to retain good, long-term tenants. This ordinance locks in those below-market rents permanently. We will never be allowed to catch up with increased costs. Meanwhile, owners who raised rents to the maximum every year are rewarded. That is backward.
Santa Barbara needs more housing and stronger relationships between landlords and tenants, not a costly new bureaucracy that drives local owners out.
