Question 1: What is ˜rent skimming?’
Answer 1: According to Civil Code Section 890, Rent skimming” means using revenue received from the rental of a parcel of residential real property at any time during the first year period after acquiring that property without first applying the revenue or an equivalent amount to the payments due on all mortgages and deeds of trust encumbering that property. In other words, an owner who does not pay the mortgage, but receives rental income, during the first year of the ownership is guilty of rent skimming. A person who commits rent skimming can be sued by the lender, and prosecuted by the local jurisdiction. A tenant of residential real property may bring an action against a person who has engaged in rent skimming with respect to that property for the recovery of actual damages, and moving expenses if the property is sold at a foreclosure sale and the tenant was required to move. A prevailing plaintiff in such an action shall be awarded reasonable attorney’s fees and costs.

Question 2:  My lease says if the tenant fails to pay the rent, I can retake possession of the rented premises. The tenant signed the lease, but I understand that this part of the lease may be invalid. Is it?
Answer 2: Yes, that part of the lease is invalid and unenforceable. Many older leases, and particularly commercial leases, contained such a provision, but court decisions have made it clear that as long as the tenant claims the right of possession, the landlord may not just ˜retake possession’ by throwing the tenant out (by either changing the locks, or otherwise preventing the tenant from gaining access). Absent an agreement with the tenant, the only legal way for the landlord to retake possession is through the unlawful detainer process, i.e. an eviction that results in a court order restoring the owner to possession. A tenant who is wrongfully evicted, by being locked out, for example, can sue the landlord, and also request and receive an order from the court putting the tenant back in possession until the landlord has gone through the proper process to evict the tenant.

Question 3: I have a vacant unit and I offered it to one of the applicants but they must give 30 days’ notice to their current landlord. Can I charge them a non-refundable deposit to hold it for them?
Answer 3: Non-refundable deposits for residential rentals (other than the cost of the screening deposit, which is limited to about $40) are generally not allowed. If the deposit appears to be related to the security deposit, in any form, it cannot be non-refundable. However, I am not aware of any objection to a separate contract between you and a prospective tenant in which you ˜sell’ to the prospective tenant a legally binding contract right called an ˜option’ to rent the unit, in exchange for an option price. For example, you and the prospective tenant could agree that in order for you to hold the unit for them exclusively for a period of 30 days, you will charge them x for that. It needs to be described as an option payment, not an advance on the rent, and not part of the security deposit. If the prospective tenant should challenge it later, likely in small claims court, you would probably prevail, but different judges have different perspectives, so only an actual ruling would provide that answer.

Question 4: My tenant signed a one-year lease, and then moved out in three months. Do I have to return her deposit or can I charge expenses such as advertising and rent until it is reoccupied?
Answer 4: The tenant is liable for those costs and expenses, but the security deposit cannot be withheld to pay them, other than to cover the amount of unpaid rent equal to 21 days of rent after the tenant vacates. The security deposit can only be applied to unpaid rent, damages to the unit beyond normal wear and tear and cleaning to restore the unit to the condition the tenant received it in. Also, the landlord must account for the deposit within 21 days of the tenant moving out. The accounting must notify the tenant in writing of any charges against the deposit, and provide receipts for work done under the cleaning or damage provisions. Courts have held that the landlord can deduct for any unpaid rent, but only until the last day of the accounting deadline, or 21 days from the date the tenant vacated. Any additional claims “ such as lost rent while the unit is being re-rented, or expenses incurred in re-renting like advertising or broker fees “ can only be recovered from the tenant by a separate action against the tenant, such as a small claims lawsuit.

Question 5: I am thinking about renting part of my home, which means I would be sharing my house with tenants. I have heard I can not specify the sex or age of the tenants, but I don’t really want to rent to very young people because I think we will have nothing in common. Also, I want other women as renters, rather than men. Can I limit the applicants by sex and/or age?
Answer 5: Fortunately, you may limit by any category the person you share your home with. A recent federal court decision discussed the issue and concluded that the anti-discrimination laws that would otherwise prohibit selection of a tenant based on any protected category such as race, religion, sex (or sexual preference), or any other personal characteristic do not apply in roommate arrangements. In a rather informal discussion of the issue, the court stated: There’s no place like home. In the privacy of your own home, you can take off your coat, kick off your shoes, let your guard down and be completely yourself. While we usually share our homes only with friends and family, sometimes we need to take in a stranger to help pay the rent. When that happens, can the government limit whom we choose? Specifically, do the anti-discrimination provisions of the Fair Housing Act (FHA) extend to the selection of roommates? Because of a roommate’s unfettered access to the home, choosing a roommate implicates significant privacy and safety considerations. The home is the center of our private lives. Roommates note our comings and goings, observe whom we bring back at night, hear what songs we sing in the shower, see us in various stages of undress and learn intimate details most of us prefer to keep private. Roommates also have access to our physical belongings and to our person. Taking on a roommate means giving him full access to the space where we are most vulnerable. Equally important, we are fully exposed to a roommate’s belongings, activities, habits, proclivities and way of life. This could include matter we find offensive (pornography, religious materials, political propaganda); dangerous (tobacco, drugs, firearms); annoying (jazz, perfume, frequent overnight visitors, furry pets); habits that are incompatible with our lifestyle (early risers, messy cooks, bathroom hogs, clothing borrowers). Holding that the FHA applies inside a home or apartment would allow the government to restrict our ability to choose roommates compatible with our lifestyles. This would be a serious invasion of privacy, autonomy and security. For example, women will often look for female roommates because of modesty or security concerns.
The court simply concluded that a rental of a bedroom within one’s home did not constitute renting a ˜dwelling unit’, and so such an arrangement is not prohibited by state or federal non-discrimination laws.

Richard Beckman, of Beckman Blair, LLP has been practicing landlord-tenant law for over 19 years, primarily in rent-controlled jurisdictions such as San Francisco, Oakland and Berkeley. He represents clients in a broad range of real estate-related disputes, including partition of co-ownership interests, purchase contract disputes, insurance coverage analysis and land use. Mr. Beckman also specializes in all aspects of landlord-tenant issues, representing landlords and tenants in residential and commercial matters. He can be reached at 415-495-8500; email rich@beckmanblairllp.com or by visiting the website www.beckmanblairllp.com.

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