As new figures show average rents in San Jose have soared 54 percent since 2010, city officials are pursuing plans to bolster rent control and tenant rights.
The City Council on Tuesday will consider prioritizing a rent control work plan for the year ahead.
San Jose has consistently ranked as one of the least affordable regions in the nation, especially as home values and rental costs have scaled back up to pre-recession heights. The latest market data shows the average rent in San Jose reached $2,227 a month. That's an average annual increase of 7.8 percent for the past five years.
But developers have been building mostly luxury apartments, which makes the newest units even pricier than the above-listed averages. At the same time, the remaining supply of housing that used to be affordable could be lost as owners cash in on a white-hot housing market. The city already lost 4,100 affordably priced homes that ticked up to market rate between 2000 and 2013, according to the city's Department of Housing.
Meanwhile, wages have remained relatively stagnant. San Jose's median household wage came in at $81,000 in 2013, a 1.1 percent uptick since the year prior and a 5.4 percent increase over 2010, according to the U.S. Census Bureau.
"This combination of stagnant wages, an increasingly bifurcated workforce, and continuously rising rents are the central reasons why housing is increasingly unaffordable in San Jose," writes Jacky Morales-Ferrand, San Jose's acting director of housing. "Furthermore, these factors contribute to an environment of uncertainty in which many households are concerned about their ability to retain their existing housing at costs which they can afford."
By existing city law, landlords of about 43,000 apartments constructed before 1979 can't up the rent more than 8 percent a year. A proposal by Councilman Raul Peralez would cap that to 4 percent a year. Hayward and Los Gatos already cap annual rent increases to 5 percent. San Francisco, Oakland and Berkeley have more restrictive rent control that ties the cap to the rate of inflation, which evens out to about 3 percent a year in allowable rent increases.
Landlords could also level up rent to market rate if a tenant voluntarily leaves. As long as property owners give enough notice to the tenant, they can evict them without cause. Another proposal being considered would enact a "just cause" ordinance, which would make it harder for landlords to evict tenants. In the past few months, the city's housing officials received 120 complaints of no-cause evictions—four times as many as received in 2011.
Peralez also suggested a protection for low-income tenants that would prohibit discrimination based on income source, including Section 8 housing vouchers. State law permits landlords to deny tenants based on rental vouchers, though some cities have enacted local rules that outlaw that type of screening.
To keep up with the added services, the city would likely have to increase the size of its Rental Rights and Referral Program, which currently employs three staff members to oversee complaints about some 43,000 rental units.
Any update to the city's rent ordinance would be limited by a state law called the Costa-Hawkins Rent Control Act, which exempts all housing built after 1995 from local rent control ordinances.
Council members Rose Herrera and Johnny Khamis want the city to assemble a Housing Affordability Task Force as it studies rent control and other housing proposals.
More from the San Jose City Council agenda for June 16, 2015:
- Councilwoman Rose Herrera will commend Velma Million, known as "Lady of the Lake," for her longtime advocacy of Lake Cunningham Regional Park.
- After a series of high-profile break-ins, the Mineta San Jose International Airport landed a $8 million grant to bolster its perimeter security.
- Riding bicycles on some downtown sidewalks will be a $25 infraction, pending this update to the city's traffic bail schedule.
- San Jose will extend its contract with CreaTV, the nonprofit that runs four local public access cable channels, for another six months to give the city more time to draft a longer-term agreement. CreaTV is funded through a small percentage of Comcast's gross revenues in San Jose, which amounts to about $1.6 million a year. Since launching in 2007, the nonprofit media group has expanded from one to four channels that broadcast hundreds of local government meetings and youth-produced programming every year. "While CreaTV has been able to earn a significant portion of its operating funds through fees for service and fundraising activities, we must pursue other funding sources that would ensure CreaTV's sustainability for the long term," Mayor Sam Liccardo and council members Rose Herrera, Raul Peralez and Chappie Jones wrote in a shared memo. "If we were to lose CreaTV we would not only lose an operator for the $1.5 million we program in restricted PEG funds, but we would lose the ability to empower our residents, especially our youth."
- A five-year agreement with the Wildlife Center of Silicon Valley will cost the city $472,000 for a renewed five-year term. The 21-year-old nonprofit treated more than 3,600 birds and fielded 1,244 calls for service in 2014. As the only facility in the South Bay treats and rehabilitates wild animals, it also receives funding from the cities of Milpitas, Campbell, Los Gatos, Cupertino, Santa Clara, Saratoga and Sunnyvale, as well as private donations and membership fees.
- Recycling rates are set to increase by 3 percent for singly-family homes and 5 percent for multi-family dwellings. That increase will cover the cost of picking up large and bulky items, which will hopefully stem illegal dumping, Herrera and Liccardo explain.
- The city is considering offering $400,000 in subsidies to bring an advanced manufacturing facility to north San Jose. FlexTech Alliance, a 20-year-old San Jose-based nonprofit consortium of tech companies and academic researchers, is vying for a $75 million Department of Defense grant to build a hybrid electronics manufacturing institute. FlexTech responded to the call for bids with a proposal to build a 35,000-square-foot facility on Lundy Avenue.
WHAT: City Council meets
WHEN: 1:30pm Tuesday
WHERE: City Hall, 200 E. Santa Clara St., San Jose
INFO: City Clerk, 408.535.1260