Below are questions asked by rental property owners regarding California rent control laws followed by answers provided by Attorney Richard Beckman.
Question 1: Did the state just pass a new law affecting security deposits?
Answer 1: Yes, as of September 18, AB 12 was sent to the Governor’s office for approval. When it takes effect July 1, 2024 (assuming it is not vetoed by the Governor), it will change the existing law, which allows a landlord to require up to 2 months’ rent, in the case of unfurnished residential property, or up to 3 months’ rent, in the case of furnished residential property, as security deposit (in addition to any rent for the first month paid on or before initial occupancy).
This bill would limit the amount to one month’s rent, regardless of whether the residential property is unfurnished or furnished, in addition to any rent for the first month paid on or before initial occupancy. However, it exempts ‘mom and pop’ owners from that restriction and allows those owners to demand up to two months’ rent as security, unless the prospective tenant is a service member, who may not be required to pay more than one month’s rent as security. The ‘mom and pop’ category means the landlord (1) is a natural person or a limited liability corporation in which all members are natural persons and (2) owns no more than 2 residential rental properties that collectively include no more than 4 dwelling units offered for rent.
Question 2: If I am evicting a Section 8 tenant for failing to pay rent, do I just need to serve a 3 day to pay or quit? The reason I’m asking is because I see a 3 day to pay or 30 days to quit notice, but I can’t find the law that requires that I give them 30 days. I thought that the only difference is that I just give 90 days when I’m evicting for no fault. Has the law changed?
Answer 2: Much of the Section 8 relationship is governed both by the lease and by the housing assistance payment (HAP) contract between the Housing Authority and the owner. Without reviewing those documents, my understanding is that nonpayment of rent by a Section 8 tenant is still subject to a three day notice. However, you should make sure that you review those documents in case there are additional obligations, such as providing a copy of the three-day notice to the Housing Authority.
Question 3: You wrote recently about the new Oakland rent registry, which was very helpful. Are there any consequences for registering late?
Answer 3: Basically, any rent increase served while the unit is not registered is at risk of being delayed six months. As the ordinance states, the owner “will forfeit six (6) months of the rent increase sought unless the owner cured the failure to register. A rental property owner may cure the failure to register required by this Section and not be subject to a forfeiture of a rent increase if the rental property owner substantially complies with the registration requirement six (6) months prior to serving the rent increase notice on the tenant or, in the case of an owner petition, at least six (6) months prior to filing the petition.
However, someone expressed concern that the registration failure could serve as a defense to a nonpayment of rent unlawful detainer, but at least that is not the case.
Question 4: Did the City of Concord just pass its own eviction and rent control law?
Answer 4: Not exactly. However, they are strongly considering it. According to a recent press release from the city, “The city of Concord has committed to the adoption of Rent Stabilization and Just Cause for Eviction Ordinances by December 31, 2023, and we’re seeking your input through our online surveys (available in English and Spanish). To assist us in drafting Rent Stabilization and Just Cause for Eviction policies, we are requesting that tenants and property owners complete these surveys by Sunday, Aug. 20, using the links below.
A short presentation has also been included for your reference. The feedback received from the surveys will go to the City Council for their consideration of the Rent Stabilization and Just Cause for Eviction ordinances at a public City Council meeting that was tentatively scheduled for Tuesday, Sept 5th. Thank you for your feedback!
General information on Rent Stabilization and Just Cause for Eviction.
If members want to weigh in, there may still be time to let the city know how you feel.
Question 5: I have established rental standards to screen new applicants. The rental standards are a minimum FICO 650 Score, and income levels of 2.5 times the monthly rent. Am I within my rights to deny an applicant based on them not meeting those two criteria, but they have labeled themselves as a victim of domestic violence? How should I approach this to avoid any retaliatory actions from the applicant?
Answer 5: I am not aware of any special considerations that must be provided to victims of domestic violence in the rental application process. There are statutory protections afforded such person related to their rights to terminate their tenancy, and to prevent evictions related to domestic violence (See, e.g. Civil Code Section 1161.3).
Question 6: Did SB 567 pass, and does it extend the Tenant Protection Act provisions to tenants as soon as they move in, rather than the one-year requirement that was the original provision?
Answer 6: SB 567 did pass both houses in the Legislature and was sent to the Governor for approval, veto or inaction on September 19. Unless the Governor vetoes the bill, within 12 days of receipt, it becomes law. There is no indication a veto is likely. However, the version that would have provided TPA protections to tenants as soon as they took possession was amended and that provision removed, and the original 12 month ‘hold’ period still applies. In other words, tenants have to be in place for at least 12 months before they receive the ‘just cause’ and rent increase protections in the TPA. The new legislation also imposes penalties on property owners who violate certain provisions, such as the ‘owner move in’ provision and the rent increase limitations. Unlike the prior version of the TPA, this version specifically allows tenants to bring suit against the owner for violations of those sections, and be awarded treble damages and attorneys fees if they prevail. It takes effect on April 1, 2024.
Question 7: My tenant is renting the apartment month to month. Is it legal to charge him the whole month rent if he moves out on the 19th day of the month? He gave a 30-day notice of his intent to move out on August 19.
Answer 7: The tenant is responsible for providing a 30-day notice of intent to terminate the tenancy, which it appears your tenant did. The tenant is responsible for the rent during that 30 day period of the notice, but not beyond that, regardless of which day of the month the notice expires.
Question 8: The documents/process on the AOAUSA website generated a few additional clarifying questions given our locations in San Francisco and Oakland.
- Form 100Q also lists “No prior evictions or collection records for non-payment of rent”. Can we still legally say this after the Covid eviction moratorium rulings? If not, what can be stated as a requirement to protect against this risk?
- Also on form 100Q “Applicant does not have any criminal convictions for crimes considered harmful to people or property”. Have any of the rules changed in SF or Oakland on those statements and if so, what can legally be stated?
Any clarification on these questions that you may have would be very helpful and appreciated.
Answer 8: I am not an expert on screening applicants, and would trust the AOA process, as they have, I believe, vetted a provider to provide a ‘turnkey’ applicant screening process.
However, as to the criminal history inquiry, Oakland, like some other localities in California, passed a ‘Fair Chance Ordinance,’ which does restrict the owner’s right to inquire as to criminal background. The ordinance generally prohibits rental housing providers from screening criminal history of applicants during the advertisement, application, selection, or eviction process. However, there are exceptions:
- Owner occupied units such as single family homes, duplexes, triplexes, and ADUs (Accessory Dwelling Units).
- Tenants who seek to add a co-tenant.
- Under certain circumstances, the housing provider may review the state’s lifetime sex offender registry after a conditional offer has been made, the applicant has consented, and been allowed to provide rebutting information.
- HUD funded units are permitted to conduct limited background checks, if required by federal rules, after the applicant has provided consent and been allowed to provide rebutting information.
Enforcement:
- Applicants who believe their rights have been infringed in violation of this ordinance can file a complaint with the City and/or file a lawsuit.
- Tenants who seek to provide housing to (a) close family member(s) with criminal history and are denied can file a complaint with the City and/or file a lawsuit.
Violations: The City can issue civil penalties of up to $1,000 per violation. If an action is filed and the plaintiff prevails, a court may award damages, attorneys fees, and penalties.
Contact Information:
City of Oakland Housing Resource Center
250 Frank Ogawa Plaza, Suite 6301, Oakland, CA 94612
(510) 238-6182
San Francisco’s version only applies to providers of “Affordable Housing”, which means “any residential building in the City that has received funding from the City, connected in whole or in part to restricting rents, the funding being provided either directly or indirectly through funding to another entity that owns, master leases, or develops the building. Affordable Housing also includes “affordable units” in the city as that term is defined in Article 4 of the Planning Code. Projects that are financed using city-issued tax exempt bonds but that receive no other funding from the city or are not otherwise restricted by the City shall not constitute Affordable Housing.”
Richard Beckman, of Beckman Feller & Chang P.C., has been practicing landlord-tenant law for over 26 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 510-548-7474; email [email protected] or by visiting the website www.bfc-legal.com.