Shall the rules that govern converting rental housing to condominiums also apply to converting rental housing to certain forms of joint ownership with exclusive rights of occupancy, and shall the annual 200-unit cap on such conversions be made permanent?
Presently, the City regulates the conversion of apartment type buildings of two to six units to other forms of ownership or occupancy. The primary conversion is to condominiums. Condominiums, as with all single unit dwellings, are not subject to rent control. Conversions are limited to 200 units a year and are done on a lottery basis. This limit will end on December 31, 2000. Currently, there is no yearly cap on the number of tenancies-in-common that can be formed. Tenancies-in-common are the ownership structure that allows 2 or more people to own a percentage of a building.
Proposition N would restrict the conversions of rental housing to tenancies-in-common. It would amend the law to include tenancies-in-common in the City’s condominium lottery by requiring that tenancies-in-common include an "exclusive right to occupy" in the deed. It would narrow the condominium conversion law which has allowed property owners to convert from rental use to homeownership using the state Ellis Act to evict renters and then selling it to owner-occupants using a tenants-in-common ownership structure. It would continue the limits on condo conversions that are already in place but due to expire. If the "exclusive right to occupy" is invalidated by the courts, no applications for condominium conversions will be approved.
In my opinion, should the proposed ordinance be adopted, in my opinion, it should not affect the cost of government.
- Summary of Arguments FOR Proposition N:
- The number of seniors, disabled, and low and middle-income people being evicted from their homes has increased dramatically in the last year. Real estate speculators take advantage of the loophole in the condominium conversion law by turning their units into tenancies in common first and then eventually into condominiums. Proposition N helps to stop the Ellis Act evictions by not allowing formation of tenancies-in-common.
The City has a limited supply of rent control/affordable housing. This ordinance restricts the removal of rental units from the market.
Since most San Francisco residents are renters and can not afford to buy either a single dwelling home or a tenancy-in-common, the City must protect these residents by preventing rent-controlled units from being converted to owned units.
The condominium conversion law is due to expire in December, 2000. If it is not renewed, many people will be displaced as there will be no limit on the number of two to six unit buildings that will be converted into condominiums..
We must protect the diversity of our city. Too many renters are either being evicted or being priced out of this city.
Currently, seniors and disabled cannot be evicted, relocation benefits are provided for evicted tenants, and tenants get the right of first refusal to buy their own units at a set price. These protections are due to expire in December, 2000.
By maintaining a cap on condominium conversion, we prevent rents from
skyrocketing. When rental units are changed into condominiums, no rent
control governs these condominiums.
- Summary of Arguments AGAINST Proposition N:
- Buying a home is a common dream for most Americans. While two thirds of Americans owns homes, only one third of San Franciscans do. This ordinance restricts home ownership opportunities by setting limits to the number of tenancies-in-common that can occur each year.
Many believe tenancies-in- common are the only way middle income people can afford to buy a home in the City. Setting limits on the number of tenancies-in-common that can be formed each year will allow only the rich to buy a home in San Francisco.
If this proposition were to pass, people would be forced to leave the City to purchase a home elsewhere since there will be a limited number of tenancies-in-common that can be
formed each year. This situation would effect the economic diversity of the City.
Homeownership encourages a heightened interest in local affairs and better care of property. It increases the tax base for the city. It affords residents better financial security. Proposition N would limit these possibilities.
Many properties are already owned as tenants-in-common. Proposition N would greatly reduce the marketability of their homes because they would have to submit to the condo lottery in order to sell. This requirement would be unfair to these homeowners.
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