Los Angeles Times reports that Los Angeles is stiffening the affordable housing requirements for new rental units constructed after demolition following an Ellis Act withdrawal of the building from the residential rental market. While “new construction” is generally exempt from local rent control ordinances (and by Costa-Hawkins), the Ellis Act specifically exempts new units (built within five years) from these exemptions, subjecting the units to existing price controls. Cities may also allow certain density bonuses for new construction in exchange for a commitment by the developer to maintain price controls on a certain number of “affordable housing units”.
The new regulation would require developers to earmark the greater of the number of demolished units or 20% of the total number of new units to affordable housing.
