A rule is being proposed in San Francisco, California which is expected to impact developers of properties under rental property listings. According to local reports, city officials have formulated a law that will get apartment developers to finance affordable housing efforts in the area.
The legislation is scheduled to be approved by the Board of Supervisors by next week. It states that apartment developers who have properties benefitting from tax breaks and zoning changes will be required to rent out part of their apartment buildings at affordable rates. In the old ordinance, all apartment developers and owners, regardless of whether they benefit or not from government efforts are given the choice of either renting part of their properties at affordable charges or paying a certain amount of fee.
The old ordinance was deemed in violation of state laws by an appellate court. According to the court, the ordinance is against legislation aimed at protecting the rights of apartment owners and developers of rental property listings to establish rental rates for their own properties. The court further added that only apartment projects that get public benefits can be required to follow the ordinance.
The appellate court's ruling was upheld statewide, but this has not stopped jurisdictions from trying to find a way to get apartment developers to provide affordable housing rates to city tenants without violating the statewide rule. The latest proposal is reportedly part of local officials' efforts to get apartment owners to do their share in providing affordable housing units to city dwellers.
According to the proponents of the new legislation, the proposal will affect but a few projects since majority of apartments benefit from public aid, either through tax exempted bonds and tax credits or through zoning changes. Law experts have stated that the new rule can withstand any legal challenge and is likely to be upheld in most areas of San Francisco.
They further added that the rule will hold at any court if it can demonstrate that rental property listings developments have some adverse effects on the housing market of a particular community. They also stated that the generic nature of the proposal will make it hard for challengers to win their case.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.
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