Beacon Economics analysis finds rents in regulated units rose 1.6 to 2.6 percentage points faster per year than in newer, uncovered units

SANTA ANA, Calif., Sept. 24, 2026 (GLOBE NEWSWIRE) -- A new economic study released by the Pacific West Association of REALTORS® (PWR) and Beacon Economics found that Santa Ana’s Rent Stabilization Ordinance (RSO) - a form of rent control, has not made an impact on housing affordability and is associated with faster rent growth. Rent control is supposed to keep rents down. In Santa Ana, the opposite happened.

The study, The Effects of Rent Stabilization in Santa Ana: Evidence from Rents, Renters, and Peer Cities was conducted by Beacon Economics with support from PWR and other housing and real estate organizations. It examines what happened to rental costs, finances, mobility and housing supply after Santa Ana adopted its Rent Stabilization Ordinance in 2021.

To measure the rent control impact, Beacon Economics compared older multifamily properties in Santa Ana that are covered by rent control policies—those built before 1996—with newer multifamily properties in the city that are not covered by policy. The study also compares Santa Ana to other Orange County and Southern California cities including Anaheim, Garden Grove, Huntington Beach, Long Beach, Orange, Ontario and Irvine, none of which had local rent control beyond statewide protections, which are less stringent than Santa Ana’s ordinance. State law generally caps annual rent increases at 5% plus inflation, up to 10%, while Santa Ana limits increase to 3% or 80% of inflation, whichever is lower.

The biggest difference emerged in annual rent increases. From 2022 to 2025, rents in Santa Ana’s rent-controlled properties increased at a faster annual rate than rents in newer, non-regulated properties. Annual rent growth was 1.6 percentage points higher for one-bedroom apartments and 2.6 percentage points higher for two-bedroom apartments. In the peer cities, the difference in annual rent growth between older and newer units was much smaller, at 0.7 percentage points for one-bedrooms and 0.6 percentage points for two-bedrooms.

As a result, regulated units did not become more affordable relative to the rest of the market. Affordability improved for reasons unrelated to the ordinance. Rent-controlled housing was traditionally less expensive on a per-square-foot basis, but that advantage narrowed after the ordinance took effect. For two-bedroom apartments, regulated units are no longer more affordable than newer units on a per-square-foot basis.

“Housing affordability is a real challenge for families across Orange County, and policymakers deserve to know whether the policies being considered are producing the results they intend,” said Sarah Ireland, President of the Pacific West Association of REALTORS®. “The data from Santa Ana shows that rent control has not delivered better affordability outcomes, and, in some cases, rents in properties covered by the ordinance increased at a faster rate. If we want to make housing more affordable over the long term, we need to focus on the underlying issue of creating more housing and removing barriers that make it harder to build.”

Additional findings from the study include:

  • Renter financial outcomes: Renters in rent-controlled units did not see measurably better affordability outcomes after the policy took effect. In 2024, median household income was $74,000 for RSO renters, compared with $71,600 for multifamily renters overall, with gains in affordability driven primarily by household income growth rather than rent stabilization.
  • Tight housing supply: Santa Ana’s multifamily vacancy rate is 3.8%, compared with about 7% nationally. Approximately 48.5% of renter households live in units covered by rent control policies, and the city’s multifamily housing stock is largely older, with the median structure built in 1962.
  • Administrative costs: Santa Ana created a 14-person unit to implement and enforce the ordinance, with adopted annual expenditures generally ranging from approximately $2.3 million to $3 million.

The report concludes that Santa Ana’s Rent Stabilization Ordinance has not meaningfully improved housing affordability and has not addressed the underlying causes of rising housing costs. The report instead points to expanding housing supply, reducing barriers to development and allowing the rental market to respond more flexibly to demand.

The full study is available at www.pwr.net/rentcontrolstudy.

About Pacific West Association of REALTORS®

Pacific West Association of REALTORS® is the preeminent real estate association in upholding professional standards, providing valuable education, and protecting private property rights. PWR is one of the largest real estate organizations in California serving more than 10,000 REALTORS® operating in thirty-three cities across Orange County and Los Angeles County. Visit www.PWR.net to learn more.

About Beacon Economics

Beacon Economics LLC is an independent research firm dedicated to objectively-based economic analysis. Learn more at www.BeaconEcon.com.

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