AB 828 Update – Learn More About the Move to Cut Rent by 25% In California

If you follow the Californian rental market, you know that there’s been plenty of activity this year on the rent control front thanks to the passage of AB 1482. This rent control measure became law in January, but that hasn’t stopped lawmakers from creating more rent control legislation including the Rental Affordability Act and AB 828.

Sadly, one would think that landlords in California have been through enough with everything that’s been done to impose rent control in this state. If AB 828 is approved, this would mean that the average landlord would be faced with dire economic consequences as any of their tenants could petition the courts to have their rents cut by 25% for one year.

What’s Happening with AB 828?

Right now, AB 828 is still moving forward through the Senate; it’s currently in the Rules Committee and this can mean that bill possibly gets postponed for several weeks while it’s debated.

Even though AB 828 continues to move forward, the California Apartment Association, and other groups that support landlords in California, have voiced their opposition of this bill and have been flooding lawmakers email and voicemail inboxes with messages opposing it.

There’s no denying that if this bill is approved it could bring a wide variety of catastrophic consequences for landlords in the state because landlords would have to absorb the economic losses and this would affect their businesses.

To voice your opposition to this bill, we encourage you to contact our lawmakers today and let them know that passing AB 828 would only further hurt the struggling rental market and make it more difficult for landlords and tenants alike.

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To learn more about the property management services that we can offer you, contact us today by clicking here.

Is now the right time to buy an investment property?

In May 2020, investors are poised to capitalize on one of the best buying opportunities in 10 years. Why? Coronavirus has left an impact on the rental market, and some owners may be willing to sell their properties for under market value, right now, or in the next 4-8 months.

Capitalize on Economic Opportunity

Even though the media often reports on the coming economic recession with fear, the reality is that most people who were investors during the “Great Recession” (2007-2009) know that the last downturn offered substantial opportunities for them to add properties that were under market value to their portfolios.

If you have cash reserves, now is a great time to start searching for deals in the real estate market, or you may want to wait for six months (or longer) until the next recession in the United States begins.

Don’t want to buy another rental property? Why not add an Accessory Dwelling Unit (ADU) to your property instead? ADU’s are another great way for homeowners to add equity to their properties while also generating rental income as well.

As David Stein of Principal Equity Group said in a recent GWM interview, the City of San Diego is making it easy for homeowners to add ADU’s to their properties. How? Besides streamlining the permit process, they also have three different sets of ADU plans available that will save homeowners the cost of having to pay an architect for a set of plans.

Besides helping to increase the value of your property, when you add an ADU, you’re also supporting the local economy as well, including contractors, painters, plumbers, and other companies that will work on your ADU.

Contact Golden west management

To learn more about the rental market in San Diego, Phoenix or Las Vegas, or speak with us about our property management services, contact us today by calling (866) 545-5303 or click here to connect with us online.

What is AB 828?

With the COVID-19 pandemic having affected everyone in California, lawmakers have been working overtime to create more legislation to protect tenants, including their latest proposal, AB 828.

What is AB 828? If passed, this bill would enable tenants to petition the courts to cut their rents by 25%, and they wouldn’t have to show cause for the rent reduction.

Would Hurt The California Rental Market

There’s no denying that many tenants in California need help with paying their rents because of the simple fact that if a tenant isn’t working, or they recently lost their jobs, they may be unable to pay their rents as before.

The good news is that even though California lawmakers have been drafting legislation to address the problem of rent payments in California, landlords and tenants have already been working together to ensure that tenants can pay their rents and stay in their rental properties.

For example, in a Zoom meeting with Brad Seaman and Justin Isaacs, Jayson Yoss, President of GoldenWest Management confirmed that less than 5% of GWM residents, in the 2nd month of quarantine, have been unable to pay their rents and less than 22% of residents have had to go into a payment plan or require a discount on their leases.

This is excellent news considering the “doom and gloom” being reported in the media on an hourly basis of how Coronavirus is affecting the economy and the rental market.

In the Zoom meeting, Jayson Yoss also confirmed that vacancies at GoldenWest Management are currently at 2%-3% as well. He sees the rental market as remaining “robust” despite the challenges posed by Coronavirus.

Why AB 828 Is Bad for Business

Even though some tenant’s rights groups may support AB 828, the reality is that if the state were to ask a restaurant like McDonald’s or a grocery store like Albertsons to cut their prices by 25%, this move would hurt that business financially and ultimately lead to their closures.

Sadly, when it comes to landlords in California, some lawmakers are under the assumption that landlords can “take it on the chin” and absorb a 25% rent reduction without any problem.

The truth about a rent reduction is that it will be especially harmful to landlords who only own one or more rental properties and rely on the income from rent to cover their expenses.

AB 828 also creates a possible due process violation, or constitutional argument, because it’s also possible that if approved, it would impede a tenant’s ability to enter into an executed contract.

Contact GoldenWest Management

To learn more about AB 828, or to speak with us about our property management services, contact us today by calling (866) 545-5303 or click here to connect with us online.

California Lawmakers Seek to Suspend Costa Hawkins

In the latest rental market news, lawmakers in California are seeking to pressure Governor Gavin Newsome to suspend Costa Hawkins, the 1995 Rental Housing Act.

How? There is currently a new bill on the November 2020 ballot called the Rental Affordability Act which seeks to expand rent control in California but the sponsors of this bill have stated that they will withdraw it “in the spirit of cooperation” if the Governor suspends Costa Hawkins.

Costa Hawkins Has Been Under Fire Since Day One

The latest attack on Costa Hawkins is nothing new in California considering that the law has literally been under fire since the day that it was passed back in 1995.

As recently as November 2018, a bill titled the Affordable Housing Act sought to suspend Costa Hawkins, but it was defeated by voters.

With COVID-19 leaving a major impact on California’s economy, and rental market, millions of people in the state are now unemployed so it’s easy to see why Costa Hawkins is in the sights of lawmakers.

There’s no doubt that the state faces hard choices since there potentially are millions of renters who won’t be able to pay their rents in the months ahead but is suspending Costa Hawkins the answer?

State-wide rent control was already passed into law last year when the Governor signed AB 1482, a law that caps limits rent increases at 5% per year plus inflation until January 2030, but most politicians in the state feel that California isn’t doing enough to protect renters.

As we get closer to November 2020, momentum will continue to build in support of the Rental Affordability Act and unless Governor Newsom suspends Costa Hawkins, we can expect this bill to be on the ballot for the November 2020 election.

What’s Next?

The best thing that voters in California can do is to educate themselves on the perils of pushing for more rent control in the state because eliminating Costa Hawkins, or passing the Rental Affordability Act, will only produce dire economic consequences in California that will last for years to come.

Even though the rental market in California needs massive change, the key to that change isn’t rent control.

What most people who support rent control measures don’t know is that rent control has a history of failure in every state that it’s been implemented.

Any time rent control is passed, supply always dries up and builders will not build more rental units because they are turned away by price controls.

California has a supply and demand problem that will not improve until more rentals are built state wide to meet the demand of renters.

Contact GoldenWest Management

To learn more about the property management services that we can offer you contact us today by calling (866) 545-5303, or click here to connect with us online.