Newsom signs into law slate of tenant protection and housing measures

Gov. Gavin Newsom signed into law a package of real estate-related measures Tuesday aimed at boosting housing development and protecting tenants. “We can’t afford a repeat of the foreclosure crisis when corporations gobbled up tens of thousands of homes, and significantly reduced home ownership among California residents,” Skinner said regarding the bills in late August.

Late last month, Newsom signed into law a measure that may have the biggest impact on renters and landlords in the short-term: AB 3088. The bill bars residential evictions through Feb. 1 for people who have lost income because of the coronavirus pandemic.

Newsom also announced on Monday that he vetoed a bill from Assembly member Phil Ting that would provide new funding for the construction of accessory dwelling units because it “could harm” the credit rating of the California Housing Finance Agency.

Rents Plummet on Urban Apartments

Desperate owners have been dropping rents and offering eye-popping concessions and optimizing on-site amenities in attempts to lure tenants. But it’s not nearly been enough to offset the trend of residents relocating to more spacious and less expensive markets as well others, including many young renters, who have lost jobs and moved back home to live with their parents.

In addition, as the economic chaos caused by the coronavirus cuts into the demand for apartments, developers continue to finish new luxury apartment towers downtown that are fighting to attract the renters that are left. Core urban markets across the U.S. are suffering from higher vacancy rates and bigger cuts in rental rates than suburban areas in the same metropolitan areas.

“Downtowns are getting hit the hardest. All of the top six markets had negative downtown absorption,” says Andrew Rybczynski, managing consultant for CoStar Advisory Services. “We’ve seen strength in two areas: the suburbs and cheaper commuter markets near major metros.”