Below are questions asked by rental property owners regarding California property management and resident manager laws followed by answers provided by Attorney Franco Simone.
Q: I recently decided that managing my 15-unit apartment building in Oceanside, California is too difficult. I decided to hire a property management company to take over managing my apartment building. How do I let my tenants know that I will not be managing my apartment building anymore?
A: You are required to serve your tenants with a notice of change of ownership/management every time ownership or management changes.
This notice must include the name, telephone number, and street address for each of the following: 1) authorized manager, 2) agent for service of process of the owner, and 3) the person or entity to make rent checks payable to. The notice must also include the forms in which payments are made, such as by check, money order, cashier’s check, and/or cash. If rent payments are made personally, then the notice must also include the usual days and hours when a tenant may make a payment. Alternatively, the lease or rental agreement may provide information to the tenant to make electronic payment or payment to a bank as long as the bank is located within five miles of the rental unit.
Q: I recently fired my property manager and am serving my tenants with a notice of change of management. I do not want to give my tenants my home address. Can I use a P.O Box as my address in my notice of change of management?
A: Yes, you can use a P.O. box for your address. However, if you do not provide an address for personal delivery on your notice of change of ownership/management, then you automatically agree to receive notices from the tenant at your P.O. Box. While this might seem like a convenient way to keep your personal information private, you risk being served with legal notice by your tenants without immediate notification. The tenant can mail you legal notice and it is deemed received by the owner on the date the mail was posted. The tenant will only have to prove they mailed the notice to you and that they used the name and address you provided. We advise you to provide an address for personal service on all notices of change of management and ownership.
Q: I just purchased an apartment building. Can I wait to serve a notice of change of ownership/management until I hire a property management company?
A: It depends. You are required to serve your tenants with a notice of change of ownership/management within 15 days of purchase or change in management. If you fail to provide proper notice to your tenants, then you cannot serve a notice or file an eviction for non-payment of rent that accrued during the period of non-compliance. This also applies to any period of time that the prior owner was not in compliance.
Q: I have a 10-unit apartment building in Lemon Grove. One of my tenants told me that I was required to have an on-site manager. Is that true?
A: No, California law requires that every apartment building with 16 or more units have a resident/on-site manager that lives within the apartment building. Since your building has less than 16 units you are not required to have a resident manager.
Q: I own a duplex and want to hire a property management company to manage my units. Does the new property manager need to have a certificate or license to manage properties?
A: It depends. Some property managers are not required to have a certificate or license. For example, an owner of a rental property may manage their rental property without any certificate or license. Further, an on-site property manager does not need a certificate or license to review rental applications, show/lease the property, and collect money for the deposit, rent, and utilities. However, an off-site property manager must be employed and supervised by a licensed California Real Estate Broker to provide these services.
Q: I recently purchased an apartment building. One of the tenants has been a resident manager for the last ten years. It appears that this tenant has not been paying any rent for the unit they occupy and has not received any wages for the time they work. This does not seem right to me. What are the rules regarding rent payments and wages for resident managers?
A: California resident manager laws are very complicated because the resident manager is considered an employee. I advise that all landlords with resident managers consult with an attorney yearly to make sure they have the most up to date information on the current laws. Resident managers are required to receive hourly pay pursuant to the city or state minimum wage laws and there is a limit to the amount of their wages that can be applied to their rent. Also, you cannot apply the resident manager’s wages towards their rent unless you have a signed resident manager agreement. If you inherit a property with a resident manager, I would advise you to present the situation to your attorney to review if the resident manager is being properly compensated and to review any agreement.
Attorney Franco Simone, of Simone & Associates and The Landlords’ Legal Center, has been doing evictions for over 20 years. He is also an adjunct law professor at the University of San Diego. Mr. Simone’s office is open Monday – Friday from 9:00 AM to 5:00 PM. Tel: 619-235-6180, website: www.landlordslegalcenter.com or email [email protected].