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Council asks city attorney to review proposed limits on corporate homeownership
Summary
The Sustainable Economies Law Center presented a draft ordinance to limit corporate purchases of single-family and small multiunit homes; council directed the city attorney to evaluate legal risks and collaborate with the group on feasibility and next steps.
The Richmond City Council heard a presentation from the Sustainable Economies Law Center on Feb. 4 about a draft ordinance intended to curb "corporate land grabs" — acquisitions of single‑family homes, duplexes, triplexes, fourplexes and separately deeded condos by investor entities.
Presenters described a proposal that would exempt nonprofit and community‑controlled housing, set a natural‑person ownership cap (proposed at four covered properties per person, with higher allowances for limited/minority-share scenarios), and allow individuals to use LLCs or trusts so long as the underlying natural persons remain within the ownership caps. The presenters said the proposal is designed to preserve homeownership opportunities for first‑time buyers and neighborhood stability and to prevent large institutional investors from buying homes en masse.
The Law Center provided a preliminary legal analysis covering municipal authority under California's home‑rule powers, dormant commerce clause concerns, due process and takings. Presenters argued the draft is narrowly tailored — applying prospectively to transfers after an effective date, exempting government and qualifying nonprofits — and identified legal tests the city attorney should apply.
Community organizations — including Communities for a Better Environment (CBE), ACE and Richmond Progressive Alliance — spoke in favor of directing the city attorney to evaluate the draft. Council members said they welcomed the additional analysis; Vice Mayor Robinson and others asked specific questions about whether the ordinance would affect new development, rental buildings larger than four units, and existing owners. Presenters clarified the proposal would not apply to large apartment complexes or to development projects and would not force divestiture by current corporate owners.
The council voted to ask the city attorney's office to collaborate with the Sustainable Economies Law Center to evaluate legal risks associated with enacting such legislation. The motion passed with Council Member Zepeda absent.
Next steps: The city attorney's office will analyze preemption, takings, dormant commerce clause and other legal issues and report back to council with conclusions about whether and how such a regulation could be implemented.
