Prop 10. Yes or No? Interview with Jay Cheng: San Francisco Real Estate Podcast
How could Prop 10 affect the San Francisco real estate market? Interview with Jay Cheng.
This week I interview Jay Cheng about the affects Prop 10 could possibly have on California and San Francisco. We discuss the repeal of Costa Hawkins and what this means for homeowners, future development and homeownership. Jay Cheng works as the Government Affairs and Community Relations Deputy Director of the San Francisco Association of Realtors.
The following is an excerpt from my podcast interview with Jay Cheng.
What do you do for the San Francisco Association of Realtors?
I do politics so that Realtors can do their business. My goal is to create a good political and legislative environment for realtors to buy and sell homes. It can mean that we have legislation that comes up at City Hall or on the ballot that is extremely negative to the real estate market or extremely negative to homeowners or extremely negative sometimes just the city economy and it becomes our job to stop it. So part of what I do is I mobilize Realtors I organize Realtors that kind of make their voices heard and and make sure they stop it at at City Hall.
Let’s start at the beginning. What is Costa Hawkins and why do people want to repeal it?
Costa Hawkins was a piece of state legislation that was passed some decades ago and it was passed because cities were not implementing rent control consistently, so you would have San Francisco and rent control was like two inches away from communism right and then you would have Pasadena and rent control did not exist at all. What happens when cities implement rent control inconsistently is that it creates huge disruptions in the real estate market in this state's economy because you're warping your neighbors real estate rental market right and so the state legislature and the California Association Realtors specifically authored this piece of legislation. The state legislature passed Costa Hawkins to set ground rules for for rent control. There’s 4 basic ground rules. First is that rent control does not apply to single family homes. Second is that rent control does not apply to condos. Third, rent control does not apply to new developments. The fourth is called vacancy control, which is essentially after a tenant moves out of your apartment you can reset the rent back up to market rate.
Is there a timeframe when the Costa Hawkins rules started?
It was started in 1995 that's one cost of Hawkins was initially passed and it set different parameters for different cities depending on when they first started rent control, so San Francisco was one of the first cities to have rent control and so our new development threshold was 1979 anything built after 1979 is not under rent control everything before that is under rent control.