Mercedes Shaffer, Real Estate Broker

Huntington Beach has long prided itself on being a charter city, empowered to self-govern and set its own rules on local matters. But just as state rent control laws have already stripped housing providers of their ability to run their businesses freely, Sacramento’s reach now extends even further—undermining cities themselves and their right to decide how their communities grow and develop.

When State Power Crushes Community Choice

Huntington Beach fought back, refusing to comply with state directives that demanded the addition of thousands of new housing units, many designated as low-income. City leaders stood firm, arguing that their charter status gave them the authority to shape growth on their own terms. But Sacramento escalated the fight to the courts, and judges ultimately sided with the state, ruling that housing mandates imposed from the Capitol override local control. The decision left Huntington Beach on the losing side of the battle—further eroding both property rights and the ability of communities to govern themselves.

What It Means to Be a Charter City

Unlike general law cities, which operate strictly under California’s state laws, charter cities have a local constitution—their “charter”—that allows them to control municipal affairs, including zoning, land use, and planning. In theory, this gives them the freedom to decide how their communities grow and change. Huntington Beach leaned heavily on this status in its battle with the state, arguing that local leaders—not bureaucrats hundreds of miles away—should determine what housing makes sense for the community. Sound familiar? Just like housing providers being told how to run their properties by officials who have never managed a single rental, cities are now being micromanaged from Sacramento.

Sacramento’s One-Size-Fits-All Housing Agenda

Sacramento has been relentless in pursuing a blanket housing policy. State lawmakers claim that forcing cities to build more housing—especially low-income housing—will fix California’s affordability crisis. The reality is far more complicated. By overriding local control, the state is creating new problems for cities throughout California, where residents already grapple with traffic congestion, crowded schools, overburdened hospitals, and rising crime. Adding thousands of new housing units doesn’t just change the skyline—it alters the fabric of the community.

The Ripple Effects on Apartments and Developers

For the apartment industry, this clash has wide-reaching implications. Artificial quotas and government-mandated construction can destabilize local markets, flooding neighborhoods with units priced below what the free market would dictate. Developers may be forced to build projects that don’t make economic sense, while housing providers could face increased regulation tied to affordability requirements. This glut of artificially priced affordable housing can also push down market-rate rents, squeezing revenue for existing properties and discouraging reinvestment. By interfering with natural market forces, the state risks creating mismatched supply, higher costs, reduced flexibility, and diminished incentives for private investment in both new and existing rentals.

A Dangerous Precedent of Government Overreach

The bigger issue here is government overreach. California is chipping away at the independence of cities across the state, eroding the principle of local governance in favor of centralized mandates. Huntington Beach is just the latest—and most visible—example of this trend. And make no mistake: every city in California is being impacted. Communities are losing the ability to say “this is who we are, and this is how we want to grow.” Instead, Sacramento decides.

Rising Costs and Risks for Housing Providers

Sacramento’s mandates for low-income housing are creating an artificial market that disrupts the natural balance of supply and demand. By requiring large amounts of new low-income units, the state is flooding the market with inventory that may not align with local needs or pricing realities. This glut doesn’t just impact new construction—it directly affects existing multifamily rentals, which now face competition from subsidized units that can undercut market rents. Housing providers are navigating a market distorted not only by new mandated units but also by state and local rent control laws that have long restricted their ability to manage existing properties. Profitability is squeezed, flexibility is reduced, and strategic planning becomes far more difficult. In effect, these top-down mandates—whether through rent control or construction quotas—interfere with both the natural market and local decision-making, producing unintended consequences such as financial strain on existing properties and a misalignment between the housing being built and what the community actually demands.

A Future of Fewer Choices

In the end, the state’s push may not just reshape Huntington Beach—it may fundamentally alter the way every community in California is allowed to govern itself. Just as state and local rent control laws have stripped housing providers of the ability to manage their own rental units, these housing mandates strip cities of the ability to make local decisions about growth and development. Once local control is gone—whether over existing rentals or new construction—it’s difficult, if not impossible, to regain. The result is a future where both communities and housing providers are forced to operate under a one-size-fits-all framework dictated from Sacramento, limiting flexibility, innovation, and the ability to respond to real market conditions.

Do you think Huntington Beach and other cities across California should have the right to decide how their communities grow, without state mandates dictating the mix and scale of housing? We’d love to hear your thoughts.

Mercedes Shaffer is a multifamily broker with REAL, serving LA and Orange County. For questions about buying, selling or 1031 exchanges, contact her team at 714.330.9999, InvestingInTheOC@gmail.com, or you can visit their website at InvestingInTheOC.com  BRE 02114448