Rent Control or Rent Stabilization Ordinances are in 17 California cities — second most in the country. San Francisco, San Jose, Berkeley, and Los Angeles all have one. Different versions are found in each city.
In LA, we have the Rent Stabilization Ordinance and homes covered by it are called RSOs. Our stabilization ordinance does not cover every home in Los Angeles. Any home built after 1978 and any plot of land that contains only one home is NOT covered.
Those under the RSO have protections that give renters power against their landlord. A landlord cannot impose a major rent increase on a tenant; only an annual increase of three-percent is allowed. Evicted tenants who are not “at fault” are eligible to receive relocation money. A habitable dwelling is guaranteed to every tenant. If a landlord ignores maintenance and repair requests, rent can be legally withheld by the tenant. A landlord cannot evict someone because of immigration status. These protections apply to all RSO tenants regardless of citizenship, race, religion or any other discriminatory reasons.
Costa Hawkins is a statewide law that curbs a city’s rent control ordinance. The law gives property owners in rent controlled areas the right to set newly vacant dwellings at market rate prices. Typically, the market rate price is far above the previous rent-controlled price. So, when the market rate price is installed, the purpose of the rent control ordinance is defeated and an affordable unit is taken from the market. Thus, there is a financial incentive for the landlord to pressure a tenant out of their unit. Costa-Hawkins states that a newly vacant dwelling set at market rate must be the result of a voluntary move. This is why it is important to be aware of the law. Landlords try to force tenants out and claim it was voluntary. That is illegal and it is important to know you are protected from harassment and no fault evictions.
The law also kicks in statewide for any new apartment units built after 1995. Prominent Los Angeles developer Geoff Palmer won a California Supreme Court case in 2009 using the Costa-Hawkins Act. Palmer was able to bypass an LA city policy that would have required him to replace affordable housing stock lost to his development. Costa Hawkins protects developers like Palmer by giving them the right to set new apartments at market rate, ignoring the dire need for units that are affordable.
The Ellis Act is another state law that hinders tenant protections. It gives landlords the right to “go out of business.”
If a landlord for any reason wants to stop renting, the Ellis Act gives them that right. Reasons include using the unit for themselves or their family, but in areas that are being quickly gentrified large developers are the ones benefitting the most. After buying a rent controlled property, developers can legally evict tenants to turn the units into condominiums. By evicting the tenants, they technically go out of the rental business. The evicted tenants experience a harsh reality — market rate prices in their newly gentrified neighborhoods are some of the most unaffordable prices in the state.
Tenants evicted via the Ellis Act have a right to relocation money, however it is rarely enough to sustain living in the area they were evicted from.
The good news is, buildings who face being “Ellis’d” have organized and are largely successful.
Tips on how to organize against the Ellis Act: here.