Check Rent Control Before Purchase
Question: We are an import-export firm in Osaka, Japan. We have an office in Los Angeles and we have leased a few apartment units for some of our local office employees.
Now the landlord has offered us the first option to buy the apartment building where we are leasing the units. What should we look at when considering the offer, other than financing and property management?
Answer: If the building you are considering buying is in the cities of Los Angeles, Beverly Hills, Santa Monica or West Hollywood, you must consider the rent control laws in each municipality. All are different in some ways but similar in many.
For instance, all have “just cause” eviction provisions, meaning that you can only evict renters with just cause, or pay them relocation fees. Just-cause evictions include things like failure to pay rent, breaking the lease or rental agreement, and having illegal subtenants.
If you want to evict a renter without a just cause, known as a no-fault eviction, the relocation fees that you must pay to the tenants can be as high as $5,000 per unit. No-fault evictions also are limited to a few specific grounds, like for owner occupancy or major rehabilitation.
You would be unable to evict a tenant in any of those cities merely because they lost their job with your company. That would not be a just cause for eviction or grounds for a no-fault eviction, which could make life difficult for you and your tenant-employees.
Also, rent increases in rent-controlled cities are severely limited. Such rent increases in L.A. are limited to 3% annually. They can vary and are tied to inflation.
Paying More for Extra Family Members
Q: We live in a large two-bedroom apartment in Los Angeles. We have a child and two adults living in the apartment. We pay the rental fee plus $50 extra rent per month for our son to live with us as an extra tenant. I have never lived in an apartment that charged “extra” for a family member. Is that legal?
A: It generally is legal for an apartment owner to charge you extra rent for an extra person in an apartment unit. In a non-rent controlled apartment, the owner needs to serve you with a 30-day notice to change the terms of the tenancy of a month-to-month tenancy. The notice assesses extra rent for the extra person.
It is not usually relevant whether the person is an adult or a child. However, in some rent-controlled cities, like Los Angeles, a first newborn child may dwell with you without a rent increase. If you have a second child, or any other extra tenant, the law allows the owner to increase the rent by 10% per extra tenant with a 30-day notice.
Also, leases and rental agreement can prohibit additional occupants, which usually is legal. In that situation the owner would serve you with a three-day notice to perform covenant or quit (get rid of the extra tenant or move out).
A Few Cities Require Interest on Rent Deposit
Q: I have lived in my Glendale apartment for 22 years. When I move into the apartment, I was required to make a $385 security deposit to the owner. On Dec. 1, the owner of the apartment sold it to a real estate firm.
I immediately requested that my deposit be returned. The seller refused, stating that my deposit had been included in the selling price to the new owner. The new owner confirmed this, saying that my deposit would be honored if and when I moved out of the apartment.
I am contemplating filing a lawsuit against the seller in the Glendale Small Claims Court for interest on the deposit he has held for 22 years. Is there any law that states that a renter is entitled to interest on a security deposit after a certain amount of time? Do I have a case?
A: You do not have a case. Although some cities do require apartment owners to pay interest on deposits, usually after one year of occupancy, Glendale is not one of those cities.
In some of the cities that require owners to pay interest on deposits of rent-controlled apartment units, like Los Angeles, the owners also are allowed to raise the deposits annually, usually at the same time and by the same amount as they raise rents.
Limiting the Stay of Overnight Guests
Q: I live in West Hollywood and I have a problem. My roommate is allowing a transient to sleep in our apartment five to six nights a week. I am very uncomfortable with this situation. Is there a law that would bar him (the transient) from being allowed to stay here more than two or three nights a week?
A: I am unaware of any such law, anywhere. Your lease or rental agreement probably limits the amount of time that guests (which is what the transient would be considered) may stay. Limits on guests usually range from between two days and two weeks. There are no hard and fast legal rules limiting them.
As you may know, the owner or manager enforces the rules in the lease or rental agreement. Complaining to them could make an uncomfortable situation with your roommate even worse, but that’s your only option other than moving out.
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Postema is the editor of Apartment Age magazine, a publication of AAGLA, an apartment owners’ service group, and manager of public affairs for the California Apartment Law Information Foundation, which disseminates information about landlord/tenant law to renters and owners in California. Mail your questions on any aspect of apartment living to AAGLA, 12012 Wilshire Blvd., Los Angeles, CA 90025.
