California approves statewide rent control bill authored by San Francisco lawmaker

SAN FRANCISCO (KGO) -- On Wednesday, California lawmakers approved a statewide rent cap. Governor Gavin Newsom called the new legislation "the strongest rent control package in America."

"I ended up spending three years couch surfing with my son," said Sasha Graham, who says in 2014, her family was forced into homelessness after she was evicted from her home in Richmond following an almost 300 percent rent increase.

RELATED: Affordable housing units in Hayward force out tenants 'making too much'

"My rent was about $550 and then it was increased to $1500... I scraped the money together, I was like okay, this is the new rent, but then all of a sudden, it was like you still have to leave."

Graham went on to join the Alliance of Californians for Community Empowerment to help fight for statewide rent control. And on Wednesday, a new bill was approved, which limits annual rent increases in California to five-percent after inflation and imposes just-cause eviction rules.

"We have to build millions of units of new housing in California, but until we do that, we have millions of Californians who are on the verge of being pushed out of their homes and we need to protect them," said State Assemblyman, David Chiu of San Francisco who was the lead author of the rent cap bill.

RELATED: SF proposal lets people living in RVs, cars to park and sleep near Balboa BART

Chiu defends the bill from critics and those who say it will discourage new construction.

"We exempt out any building that is 15 years or younger," said Chiu, who went on to explain further compromises within the bill that he hopes would appease California's real estate community. "We exempted out many single-family homes unless it's owned by a corporation, as well as owner-occupied duplexes."

But, there are still plenty of critics who think the bill will backfire.

"I think that it is a failure on an economic basis," said Harmeet Dhillon, who is on the Republican National Committee for California. She believes the new bill will actually cause rent increases.

RELATED: Bay Area housing prices: A look at the outrageous numbers

"Currently landlords who might be doing one percent or two percent increases to help out their tenants are going to be incentivized to do the maximum rent increases every year to make sure that in years where they're going to need that additional help, they can pay for the evictions that are going to be much more difficult to do as a result of this new law."

Governor Newsom has said he will sign the bill in this final week of the legislative year. The bill would go into effect on the first of next year.