By admin 
During his State of the State address earlier this year Gov. Gavin Newsom said an issue required urgent attention: Investment companies scooping up hundreds of homes and turning them into rentals.
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He vowed to work with legislators to combat the “monopolistic behavior, and strengthen accountability, level the playing field for working families.”
That was five months ago.
Since then, the governor has not released any more details about what he wants the state to do and did not champion two bills put forward by legislators who were hoping for Newsom’s support. He also did not include it in a proposed state budget he released in May.
When asked for an update on the governor’s plans, a spokesperson responded: “We’ll be sure to let you know if we have anything to add.”
The lack of action is surprising, in part, because the idea of cracking down on Wall Street investment firms buying up houses has bipartisan support from prominent politicians. Newsom’s pledge came after a day after President Donald Trump said he wanted a ban on investors purchasing single-family homes. And members of Congress are currently pushing a bill that calls for limits on investment funds and corporations buying houses.
Francisco Duenas is the executive director of the group Housing Now! California. He said its member organizations were excited when Newsom brought the topic up during the speech, and that the lack of action was a missed opportunity.
“At the very least, I would have liked to see him continue to lift up the issue as an example of the reforms that are needed,” Duenas said.
Critics say when investment companies buy up and lease out large numbers of properties, it pushes rents higher and elbows out people looking to purchase homes. But the practice is not particularly widespread.
In California, about 3% of single-family homes are owned by holders of at least 10 properties, according to the California Research Bureau. Invitation Homes, a publicly traded company, is the largest homeowner in the state with more than 11,000, the agency found.
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A spokesperson for Invitation Homes said it had not had any conversations with the governor, or his administration, about his comments. The National Rental Home Council, a trade group for the single-family rental home industry did not respond to emails requesting comment.
“I think it’s shameful that we allow private equity firms in Manhattan to become some of the biggest landlords here in our cities in California,” Newsom said during the State of the State. “It’s time to tackle the issue and I look forward to working with all of you to address it.” He called for more oversight, accountability and potentially changing the state’s tax code.
Assemblymember Matt Haney, D-San Francisco, followed the call. Less than two weeks after the speech, he introduced a measure that would have prevented owners of 50 or more single-family rental properties from using a tax break that allows for gains from selling a property used for a trade or business to be deferred if a taxpayer acquires another property of a “like-kind.”
Newsom did not publicly support of the idea before it died in a committee in April.
“When the governor first raised this issue, he tapped into the bipartisan belief that people want homes to go to families, not investment portfolios,” Haney said in a statement. “My bill was an effort to move that conversation into action, and I’m hopeful we’ll see some progress, whether through the Legislature or action from the governor. This issue isn’t going away.”
Assemblymember Alex Lee, D-San Jose, already had a bill to limit companies with more than 1,000 single-family homes from buying new properties and then leasing them. It had been proposed almost a year before Newsom gave his speech. Lee was hopeful the governor’s comments would help push his bill forward.
Instead, it has remains stalled in the Senate where it has languished for a year.
“Since January we’ve barely seen any action or talk of this issue from the governor or his administration,” Lee said. “It’s very disappointing.”
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