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The big lie about California’s housing crisis

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Two men work on construction of a future housing and shopping complex near 8th and Market streets in June 2016. (Jessica Christian/S.F. Examiner)
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It’s official: The rent in California, not just San Francisco, is too damn high.

California now has the highest poverty rate in the nation when the cost of housing is taken into account. Since 2005, more than 2.5 million Californians have been forced to leave the state in search of an affordable home.

Unfortunately, the prevailing supply and demand — “just build” — mantra put forward by opinion leaders is diverting state government from the hard truth that the market has not responded to the demand of California families for affordable homes — not luxury and market-rate homes.

We are told a big lie, that the solution to our housing crisis is to get government out of the way and leave it to the free market to let affordable housing magically “trickle down” to lower-income households. The truth, though, is developers build to make a profit, not to provide a social need. Luxury housing doesn’t trickle down, at least not at a scale to bring down rents in a meaningful way.

Meanwhile, there are new players in the game, changing the parameters of the problem: the rise of Wall Street’s new rental empire. In recent years, real estate speculators have been taking rent-controlled homes in San Francisco off the market and harassing long-time tenants because Costa Hawkins lets them raise the rents when old tenants move out.

The biggest owners in California are no longer mom-and-pop landlords, but mega corporations like Blackstone and Colony Starwood, and smaller speculators that follow their lead in raising rents. This time, instead of predatory mortgages, we’re seeing predatory rentals.

State laws written by the Realtor lobby, like the Costa Hawkins Rental Housing Act, which severely restricts cities from passing rent control on many types of buildings and on vacant apartments, now serve as a means to line the pockets of landlords and give them the right to charge as much as they want, while more and more of us live with housing insecurity.

If we want to meet our housing needs, we need solutions that tackle the problem directly, instead of continuing to reward the same actors who are getting rich off the crisis. If we want affordable housing, we need to build affordable housing, instead of cutting more than 70 percent of affordable housing funding since 2008, as California has done.

Even more urgently, if we want to stop gentrification and rising rents from displacing vulnerable communities, we need to strengthen tenants’ rights and pass laws to keep rents from rising even higher. We need laws that are designed to put our basic needs first, not corporate profits.

This is why families in cities across the state, who have been organizing locally for rent control, tenant protections and affordable housing, are uniting today to repeal Costa Hawkins and expand state support for affordable housing. This movement extends far past the usual suspects: from grassroots volunteer groups to small allied landlords, to highly coordinated labor unions and community organizations. This broad base of organizations and activists have launched of a new statewide coalition called Housing Now, comprised of people who don’t have the luxury of waiting to see if market forces materialize.

Families are being displaced in droves. As speculators buy, raise rents and flip whole neighborhoods, communities are being uprooted entirely. The racial, cultural and economic fabric that makes California beautiful is on the brink of nonexistence, and we can’t wait for market to “just build” and “trickle down” our way out of it. That’s why today families, workers and small landlords are taking direct action by occupying corporate offices and confronting rent-gouging, mega-landlords in dozens of cities across the state to demand a rent freeze and to call on our elected officials the repeal of Costa Hawkins.

No more “supply and demand” as usual. We need Housing Now!

Deepa Varma is director of the San Francisco Tenants Union.

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