Proposition 10 has failed at the ballot box, leaving the state’s limits on rent control intact. Proposition 10 would have repealed a California law that limits how cities enact rent control. Its defeat is a blow to tenant activists in Los Angeles, and a win for landlords.
With the resurgence of cities as centers of economic energy and vitality, a majority of millennials are opting to live in urban areas over the suburbs or rural communities. Sixty-two percent indicate they prefer to live in the type of mixed-use communities found in urban centers, where they can be close to shops, restaurants and offices. They are currently living in these urban areas at a higher rate than any other generation, and 40 percent say they would like to live in an urban area in the future. As a result, for the first time since the 1920s growth in U.S. cities outpaces growth outside of them. So, it’s important for tenants to understand their rights.
The city of Los Angeles is one of just 15 California cities with rent control regulations on the books, and the local rules do more than keep down monthly payments for tenants. They also provide protections from eviction and financial resources in the event a renter is forced to move out of their apartment. Let’s be clear, the City of LA does not have rent control. There are no limits on how much an apartment here can cost unlike rent-controlled units in other cities. Instead, LA has the Rent Stabilization Ordinance (RSO).
If you do not live in Santa Monica, West Hollywood, Beverly Hills, or the city of Los Angeles, whether your apartment is rent-controlled depends mainly on what type of housing it is and when it was built. Single-family homes are almost never subject to rent control (though they are in rare cases in Santa Monica and West Hollywood); duplexes, triplexes, and apartment buildings, on the other hand, are fair game. Date of construction also matters. In Los Angeles, only buildings built and occupied before October 1, 1978 have rent control restrictions. The date varies city-to-city. In Santa Monica, it’s April 10, 1979; in West Hollywood, it’s July 1, 1979; in Beverly Hills it’s February 1, 1995. In the city of Los Angeles, it’s easy to check on the date of construction for your building—and whether it’s covered by the RSO. Just enter your address into ZIMAS (http://zimas.lacity.org/), the city’s property database. An outline of the property will appear on the map and a sidebar will pop up on the lefthand side of the screen. In the “assessor” tab, you’ll find the building’s date of construction and in the “housing” tab you can find out whether it’s under rent control.
The Los Angeles Rent Stabilization Ordinance (RSO), addresses allowable rent increases for rent controlled units, which can range from 3% to 8% and for July 1, 2017 through June 30, 2018 landlords can raise the rent once every 12 months by the annual allowable increase of 3%. What tenants fail to acknowledge is the landlord’s right to raise the rent by an additional one percent (1%) for each of the two utilities supplied (gas and/or electricity). What is even more surprising with the RSO is at the same time the landlord raises the rent, if the written lease so provides, the landlord may also raise the security deposit (and last month’s rent if applicable) once every 12 months by the annual allowable percentage increase (previously 3%). And a landlord who is planning to improve his rental, may apply for special rent increases based on an application for Primary Renovation, Capital Improvements, Rehabilitation, or a “Just and Reasonable” rent adjustment which must be submitted to and approved by the Rental Board.
As a Los Angeles tenant, there are (3) additional items to be aware of:
1) If a landlord serves a written thirty (30) Day Notice of Rent Increase and provides the tenant a copy of the Registration Certificate, they may collect $12.25 from each tenant in June (50% of the annual $24.51 registration fee paid to the Rent Stabilization Division) and also collect the annual $43.32 Systematic Code Enforcement Program (SCEP) fee if paid in full by the landlord by increasing the rent $3.61 per month.
2) The special circumstances which allow the landlord to raise the rent substantially. The Landlord can raise the rent by 10% percent (within the first 60 days) for each additional tenant / occupant of a rental unit exceeding the number of initial occupants allowed in the original rental agreement. The Landlord can raise the rent nineteen percent (19%), plus 2% if the landlord provides the gas and electricity, If a landlord has not increased the rent since May 31, 1976.
3) Though the RSO provides that the rent may be raised to any amount upon re-rental if vacancy is based on certain reasons, there are certain vacancies that the Los Angeles RSO requires the rent to a new tenant to remain the same as that for the prior tenant. Examples include: (1) an eviction to recover the unit for the use of the landlord, his immediate family. or a resident manager; (2) an eviction based on the prior tenant’s illegal acts; (2) an eviction based on the tenant’s refusal to sign a new lease with the same terms as are in the RSO; and (3) an eviction based on the tenant’s refusal to allow the landlord reasonable access to the unit.
Tenants living in rent-controlled units can be evicted, but benefit from stronger legal protections than those living in non-rent-controlled buildings. This is referred to as a “just-cause eviction.” The city outlines fourteen legal reasons for a landlord to evict someone from a rent-stabilized unit. Eight of these are the result of actions (or inactions) by the tenant. The other six are not attributable to any faults of the tenant, but they are allowed nonetheless. Failure to pay rent, violating the terms of the lease, being a nuisance, using the apartment for illegal activity and not being the person who signed the lease (or someone approved to live in the unit) are five obvious reasons for an at-fault eviction. California law states a landlord can move to evict a tenant with only three-day advance written notice for these faults. In turn, tenants have up to three days to correct them to avoid eviction.
The only other common cause for eviction is through California’s Ellis Act, which allows landlords to mass-evict tenants when taking a property off the rental market. That could mean tearing the building down, for instance, or redeveloping it as for-sale condos. In these cases, landlords are required to pay relocation fees to help tenants find and move into a new place. Fees range from $8,050 to $20,050. The amount depends on how long tenants have lived in the building, how old they are, and how much money they earn.
Passed in 1985, the Ellis Act is another piece of legislation despised by tenant advocates, who argue that it encourages property owners to replace affordable apartments with new construction or pricey for-sale units. According to a report from the Coalition for Economic Survival, more than 23,000 apartments in Los Angeles have been cleared of renters between 2001 and 2017. In Beverly Hills, eviction protections are weaker, but landlords still have to cover a tenant’s moving expenses when asking them to move out through no fault of their own. After an Ellis Act eviction, a building must remain out of the market for five years. Yet the L.A. Tenants Union has found units available on AirBnB immediately after an eviction, as well as instances of new tenants moving in while evicted tenants move out, and emptied buildings being immediately sold to developers to build new apartments in their place. Whatever the reasons for a no-fault eviction, the landlord is required to compensate a tenant for relocation. According to HCID, payment “depends on whether the tenant is an Eligible or Qualified tenant, the length of tenancy, and the tenant’s income.” A Qualified tenant is 62 or older, disabled, or has minor dependents living with them. All other tenants are considered Eligible. Current relocation rates run $7,550–$19,500 per leaseholder.
In order to make rent-controlled units available to new tenants, landlords often resort to “cash for keys” offers, in which they effectively pay tenants to leave. Under LA’s rent control laws, this is legal as long as landlords first inform tenants of their rights and notify the city of the agreement. Tenants have 30 days to cancel the agreement in case their landlord isn’t following through with the terms of the buyout. There’s also no reason that tenants have to agree to the offer. Those who wish to continue living in their current apartment can simply turn the money down.
If a tenant does not live in rent-stabilized housing, a landlord may evict them for any reason. However, the law requires that tenants receive advance written notice depending on the length of occupancy. A landlord terminating a month-to-month tenancy must offer sixty-day notice to someone who has lived in a unit for more than a year, or thirty-day notice for less than a year. Usually, that notice does not have to state the landlord’s reason for eviction. This is one of the key arguments for expansion of RSO: anyone in a unit built after 1978 is susceptible to a sudden eviction with nary an explanation. Trying to secure new housing on a sixty-day notice in the middle of a worsening affordability crisis only adds to the anxieties and vulnerabilities of tenants across the city.