2020 CA Ballot Initiatives Affecting Multifamily Investment Properties

By NAI NorCal’s Berger Mandel Associates: Ethan Berger, Benjamin Mandel, Garrett Blair, and Cole Byrd

Proposition 21

Local Rent Control Initiative and Costa-Hawkins Repeal

Proposition 21 would reverse a ban on local rent control laws by repealing the Costa-Hawkins Rental Housing Act, which prohibits cities from passing rent control ordinances for housing built since 1995. It was widely rejected in 2018.

Proposition 15

Limits on Property Taxes

Proposition 15 would rewrite Proposition 13, which was put in place in 1978 and limited annual property tax increases and allows properties to be reassessed only when sold. Under the new “Split Roll Tax” Measure, commercial and industrial properties would be taxed based on current market values rather than original purchase prices, dramatically increasing the tax burden of landlords throughout California.


Rental Payment Default during COVID-19

This bill would defer rents indefinitely for COVID-19 affected tenants. This could last until 15 months after a state or local state of emergency is lifted. In addition to collecting no rent from delinquent tenants, landlords would receive no funding under AB-1436 to help pay their operating expenses.


Temporary Moratorium on Foreclosures and Unlawful Detainer Actions

AB-828 would protect nuisance tenants by allowing them to initially ignore an unlawful detainer complaint and stay in the unit; mandates rental property owners demonstrate economic hardship to collect the contracted rent in a timely manner; and requires very limited proof from the tenant that they faced a COVID hardship to stay in the unit. Previously, the bill included a mandate to reduce rents by 25% across the board.


Homeless Accountability and Prevention Act: Rental Registry Online Portal

This bill would create a statewide rental registry to annually collect tenant and housing data from landlords who own five or more rental units. The registry would publicly broadcast the unit mix, rent amounts, number of evictions, and ownership of rental properties statewide.


Sale of Rental Properties: Right of First Offer to Tenants

Under AB-1703, tenants and certain community groups would have the right to make an offer to buy rental housing with preferential treatment before any other prospective buyers, potentially keeping for-sale rentals off-market for nearly a year.

The Berger Mandel Associates team prides ourselves on being a resource for multifamily owners and investors, and we encourage you to reach out with any questions regarding the rental and sales market. We wish everyone good health and safety and hope to connect with you soon.