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The People's Republic of California (a one party state, entirely controlled by Democrats - assisted by very liberal court judges and a media totally in their pocket) has the distinction of having the highest rents (and lowest vacancy rate) of any state.
Why?
1. The fundamental rule of pricing: supply and demand. Since real estate prices are sky high, many cannot buy a condo or house and thus must rent. The demand is very, very high. But very few apartment complexes are being built, and fewer and fewer are renting out their own condo or house. The supply is SLOWLY growing but far, far less than the demand. The state indicates how many apartments must be built each year to keep up with demand, but few counties even reach 1/3 of that, in some cases, no apartments are built in the entire county.
2. The government has done everything in their power to make it difficult to own rental property. There are extensive "renter rights" all aimed at discouraging anyone from owning rental property. Latest example? The excuse now is the pandemic.... so renters don't have to pay rent (whether they are employed or not). Technically, they are suppose to make up the past rent, but we know from experience this never happens. Of course, the landlord still has to pay the mortgage, the property taxes, the insurance, the HOA fees, etc. This forces more and more to sell their condo or house rather than rent it out (reducing supply) and as the only way they can recover past due rent (since it's nearly impossible to remove a renter for past due rent). And independent owners of rental complexes try to convert the complex to condos for the same reason. High end complexes (with rents sometimes approaching $10,000 a month) often owned by huge international corporations can absorb these looses but not the little guy , the guy who owns a condo or two and rents them out.
3. While the government whines about the lack of housing, especially for lower income people, it doesn't allow such to be built. Neighbors are given a strong role in what gets approved for land, and the last thing they want is apartments (especially lower-rent ones - luxury ones are sometimes okay). "NIMBY" it's called, "Not In My Back Yard"). Neighbors want the land kept open or perhaps will allow only luxury houses or a park. They don't want more traffic on their street. MANY proposed apartment complexes never get approved or built because of neighbor protest or because the city views them as an economic negative - requiring more in city expenses than will be created in taxes. Cities want rich people, stores that create lots of sales taxes, positive economic factors.
4. Rent control. A sacrament for democrats, it has been imposed in many California cities. As soon as it is, all apartment construction ends. An apartment in this system will slowly become less and less profitable and eventually will become a loss. So, no one will build in such a city. Supply stops... demand grows. When a new tenant moves in (perhaps replacing a renter a year or more behind in rent), the rent can be "adjusted" (depending on the law in that city) and up, it goes up - to the max allowed.
5. To Democrats, the rich are the problem (kind of like the Jews in Nazi Germany). Since Democrats tend to see the rich as property owners, it is good to hurt and hinder them. Problem is, by definition, a rental is owned by someone else. An enemy.
.
Why?
1. The fundamental rule of pricing: supply and demand. Since real estate prices are sky high, many cannot buy a condo or house and thus must rent. The demand is very, very high. But very few apartment complexes are being built, and fewer and fewer are renting out their own condo or house. The supply is SLOWLY growing but far, far less than the demand. The state indicates how many apartments must be built each year to keep up with demand, but few counties even reach 1/3 of that, in some cases, no apartments are built in the entire county.
2. The government has done everything in their power to make it difficult to own rental property. There are extensive "renter rights" all aimed at discouraging anyone from owning rental property. Latest example? The excuse now is the pandemic.... so renters don't have to pay rent (whether they are employed or not). Technically, they are suppose to make up the past rent, but we know from experience this never happens. Of course, the landlord still has to pay the mortgage, the property taxes, the insurance, the HOA fees, etc. This forces more and more to sell their condo or house rather than rent it out (reducing supply) and as the only way they can recover past due rent (since it's nearly impossible to remove a renter for past due rent). And independent owners of rental complexes try to convert the complex to condos for the same reason. High end complexes (with rents sometimes approaching $10,000 a month) often owned by huge international corporations can absorb these looses but not the little guy , the guy who owns a condo or two and rents them out.
3. While the government whines about the lack of housing, especially for lower income people, it doesn't allow such to be built. Neighbors are given a strong role in what gets approved for land, and the last thing they want is apartments (especially lower-rent ones - luxury ones are sometimes okay). "NIMBY" it's called, "Not In My Back Yard"). Neighbors want the land kept open or perhaps will allow only luxury houses or a park. They don't want more traffic on their street. MANY proposed apartment complexes never get approved or built because of neighbor protest or because the city views them as an economic negative - requiring more in city expenses than will be created in taxes. Cities want rich people, stores that create lots of sales taxes, positive economic factors.
4. Rent control. A sacrament for democrats, it has been imposed in many California cities. As soon as it is, all apartment construction ends. An apartment in this system will slowly become less and less profitable and eventually will become a loss. So, no one will build in such a city. Supply stops... demand grows. When a new tenant moves in (perhaps replacing a renter a year or more behind in rent), the rent can be "adjusted" (depending on the law in that city) and up, it goes up - to the max allowed.
5. To Democrats, the rich are the problem (kind of like the Jews in Nazi Germany). Since Democrats tend to see the rich as property owners, it is good to hurt and hinder them. Problem is, by definition, a rental is owned by someone else. An enemy.
.
