California rent control initiative Proposition 21 failed Tuesday, with 59.3% of the 10.1 million votes recorded rejecting the measure before the Associated Press called the race around 10:45 p.m.

It was the second time in two years that California voters rejected a rent control measure at the ballot box.

Proposition 21 would have revised a 25-year-old law that prohibits local governments from freezing housing costs on buildings constructed after Feb. 1, 1995 and single-family homes.

After Proposition 10 failed in 2018 with 59% of voters rejecting the rent control measure, activists amended their plan this year to allow landlords more wiggle room in raising rents in between tenants. They also exempted property owners with up to two single-family homes.

Polls consistently showed Proposition 21 was likely to flounder, with an Oct. 26 Berkeley Institute of Governmental Studies survey showing 37% of voters in support of the measure, 48% against and 15% undecided.

“Yet again California voters clearly understood the negative impacts Prop. 21 would have had on the availability of affordable housing in our state by clearly rejecting this radical ballot measure,” California Apartment Association CEO Tom Bannon said in a statement. “It is now time to move from ballot box battles and enact policies through the Legislature that allow the state to build more affordable housing that will once again make California an affordable place to live for our families.”

Cities like Los Angeles and San Francisco already have limited rent control ordinances that went into effect before the ban on local rent control ordinances took effect. In total, around 20% of Californians live in cities with rent regulations, according to the review of the ballot measure by the Legislative Analyst’s Office.

For years, however, Proposition 21 sponsor and Los Angeles-based nonprofit AIDS Healthcare Foundation has fought for a more expansive law to keep tenants sheltered. Given California’s desperate housing shortage, the group has argued, tenants couldn’t wait for more construction to help drive down jaw-dropping rent prices.

With support from the state Democratic Party, SEIU and other left-leaning civil rights group, the campaign has argued the economic devastation caused by COVID-19 would convince voters of the need for Proposition 21. Amid double-digit unemployment rates, the coalition claims rent control would keep financially vulnerable Californians stable during the crisis.

Still, a broad coalition of business and real estate groups, affordable housing advocates, labor representatives and high-profile figures like Gov. Gavin Newsom, rejected the idea that Proposition 21 would pull California out of its housing crunch or save tenants from eviction.

”Running against both the governor of California and his allies in the powerful real estate industry was never going to be easy,” said Yes on 21 campaign director René Christian Moya. “Given the headwinds we faced against – some very deep-pocketed and deceitful opponents – we are disappointed, although not completely surprised that Prop 21 fell short at the ballot box tonight.”

The No on Proposition 21 campaign, led by the California Apartment Association, claimed the measure would have initiated a “housing freeze” by discouraging construction on every type of housing.

The groups also pointed to a law Newsom signed last year that prohibits landlords from raising rents by more than 5% plus inflation, or 10%, whichever is lower, as evidence of a form of rent control already on the books in California.

Rent control opponents raised far more money than campaign supporting the initiative. The ‘no’ campaign hauled in at least $84 million. The “yes” side raised about $40 million with the AIDS Healthcare Foundation contributing nearly all of the supporting money.

“We vow to continue the fight for housing justice for California’s 17 million renters,” Moya said, “and express our profound gratitude to our dedicated campaign team as well as great thanks to over 300 organizations, elected officials and individuals who endorsed Prop 21—a coalition that will live to fight on in this battle.”

Hannah Wiley joined The Sacramento Bee as a state politics reporter in 2019 to cover the California Capitol. She’s a Chicago-area native and a graduate of Saint Louis and Northwestern Universities.

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