California Gov. Gavin Newsom delivers his State of the State address to a joint session of the legislature at the Capitol, Wednesday, Feb. 19, 2020.
Photo: Rich Pedroncelli/Associated PressGovernor Gavin Newsom is pleading with his Legislature to fix California’s government-created housing shortage. As usual, Democrats are responding with a jack-hammer against business that will cause more problems.
Berkeley state Senator Nancy Skinner last week introduced legislation that would let local governments fine developers that leave homes unoccupied for at least 90 days. Local governments would also be allowed to use eminent domain to acquire vacant properties and then rent them or sell them to a nonprofit.
The bill targets so-called house flippers who buy and fix up homes—usually in foreclosure—and then resell them for a profit. But it would also punish landlords who may now be more inclined to leave properties vacant because the cost of upkeep and improvements exceed the rent they can charge under the state’s new rent-control law.
“My bill is designed to give local governments more tools to incentivize those corporations to actually put people in these homes,” Ms. Skinner says. Except that it would do the opposite. It costs $750,000 to build a new low-income apartment in San Francisco, but investors can renovate and sell a foreclosed home in Berkeley for less. There would be less incentive to invest in or improve the housing stock since the government could seize properties for a pittance.
This may be the real goal. Liberals worry that housing improvements could increase prices in currently affordable neighborhoods. So they’d rather have local governments or nonprofits control the housing stock. Watch the affordable housing shortage get worse.
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