California Rent Control and Emergency Orders explained!
Assembly Bill No. 1919: law, as defined, declared by the Governor, it is a misdemeanor with specified penalties for a person, contractor, business, or other entity to sell or offer to sell certain goods and services, including housing, for a price that exceeds by 10%. It is a misdemeanor for a person, business, or other entity to increase the rental price, as defined, advertised, offered, or charged for housing to an existing or prospective tenant by more than 10% and, additionally, it is a misdemeanor for a person, business, or entity to evict a housing tenant, then rent, or offer to rent, to another person at a rental price higher than the evicted tenant could be charged per Section 396 of the Penal Code, punishable by imprisonment in a county jail for a period not exceeding one year, or by a fine of not more than ten thousand dollars ($10,000), or by both that fine and imprisonment.
Assembly Bill No. 1482: Prohibits an owner of residential real property from terminating a tenancy without just cause. For certain just cause terminations that are curable, the owner must give a notice of violation and an opportunity to cure the violation before issuing the notice of termination. If the violation is not cured within the period set forth, a 3-day notice to quit without an opportunity to cure to be served to terminate the tenancy is allowed.
For no-fault just cause terminations, the owner, the owner’s option, can either assist certain tenants to relocate, regardless of the tenant’s income, by providing a direct payment of one month’s rent to the tenant or waive in writing the payment of rent for the final month of the tenancy, before the rent becomes due.
Until January 1, 2030, owners of residential real property are prohibited from, over the course of any 12 months, increasing the gross rental rate for a dwelling or unit more than 5% plus the percentage change in the cost of living, as defined, or 10%, whichever is lower, of the lowest gross rental rate charged for the immediately preceding 12 months, subject to specified conditions. The bill would prohibit an owner of a unit of residential real property from increasing the gross rental rate for the unit in more than 2 increments over 12 months after the tenant remains in occupancy of the unit over 12 months.
Assembly Bill No. 3088: Until February 1, 2025, the COVID-19 Tenant Relief Act of 2020 (Tenant Act) requires that any 3-day notice, that demands payment of the rental debt, served on a tenant during the covered period, who meets specified criteria, a declaration of COVID-19-related financial distress, can not be evicted for failure to comply with the notice if the tenant delivers a signed declaration of COVID-19-related financial distress to the landlord. The Tenant Act would prohibit a court from finding a tenant guilty of an unlawful detainer before February 1, 2021. A landlord is allowed to require a tenant, to submit documentation supporting the claim that the tenant has suffered COVID-19-related financial distress. Until February 1, 2021, a violator of these provisions whose tenant has provided to that violator the declaration of COVID-19-related financial distress described above liable for damages in an amount between $1,000 and $2,500. Small Claims Court has jurisdiction in any action for recovery of COVID-19 rental debt, regardless of the amount demanded, and would provide that a claim for recovery of a COVID-19 rental debt is exempt from the prohibition on filing more than 2 small claims actions.
With the increase in activity and pressure that the Sacramento Rent-Control advocacy groups have been applying to local, municipal, and State legislators, they are gaining more sway here in Sacramento. It seems inevitable that Sacramento is heading towards a "real" rent control bureaucracy. The emergency legislation currently in place is almost assuredly a litmus test for more legislation to come.
California Passes AB 3088 Providing COVID Related Eviction Relief!
On Tuesday the Governor signed AB 3088 into law, which establishes a moratorium on evictions for non-payment of rent due to COVID-19 financial hardship until January 31, 2021.
Under this new legislation, tenants who are able to demonstrate hardship as a result of the pandemic are only required to pay 25% of their rent from September 1, 2020, through January 31, 2021. If tenants are unable to pay this 25% the landlord may proceed with filing for an eviction beginning February 1, 2021.
The applicability of the moratorium is subject to proof that the tenant is unable to pay rent as a result of the COVID-19 pandemic. While a former version of the bill would have allowed tenants to file an attestation that they were experiencing a pandemic-caused financial hardship, the law would now require that the tenant swears under penalty of perjury that they are enduring hardship due to the COVID-19 pandemic. Furthermore, if a tenant earns 130% of a county’s area median income or higher, the owner of the property can ask for proof that the tenant is suffering from financial hardship due to COVID-19, such as a wage-reduction notice from an employer, or notice of a layoff.
This legislation effectively ends the uncertainty as to moratoriums placed on evictions by the individual counties throughout the state. Eviction moratoriums previously passed by counties and cities will be “grandfathered” in, however they will no longer be allowed to pass any extensions regarding non-payment of rent. If a local ordinance gives tenants a period in which to pay off an unpaid rental balance, that period must begin at least by March 1, 2021, and must end no later than March 31, 2022.
Unfortunately, this bill does not provide for protection for property owners who may be relying on the rental income to pay their mortgage. Mortgage forbearance was not included in AB 3088, and property owners are not permitted to sue tenants for unpaid COVID-19 rental debt (other than the debt accrued from September through January as mentioned above) until March 1, 2021.
In an effort to mitigate costs for property owners who have to proceed with eviction cases, this new legislation temporarily expands the jurisdiction of small claims court (which removes the burden and expense of attorney involvement) to allow a property owner to collect rent from their tenant even if the amount sought exceeds the small claims court limits.
However, presumably recognizing the potential hardships this new legislation may cause, the bill also increases penalties for illegal lockouts and intimidation of tenants. As the courts remain closed and the property owners remain helpless as to remedies for non-payment, there have been reports that landlords are increasingly turning toward “self-help,” such as simply locking out their tenants from the premises. In an effort to curtail illegal evictions the legislature has decided to increase the penalties for these types of “self-help” measures.
In summation, this new legislation provides for the protection of tenants and is a potential nightmare for landlords who are relying on the rental income to pay their mortgage, as evictions are once again prohibited for inability to pay rent as a result of COVID-19. The silver lining is that beginning on October 5, 2020, landlords will once again be allowed to proceed with eviction cases for nonpayment of rent or other charges if the tenant has not been impacted by the COVID-19 pandemic. In order to do so, however, the landlord must give a 15 business-day notice to the tenant to either pay the demanded amount, vacate the premises, or return a declaration to the landlord, under penalty of perjury, that they have suffered financial hardship as a result of the COVID-19 pandemic.
N TENANT EVICTIONS DUE TO COVID-19, AMENDED JUNE 30, 2020
March 17, 2020, Sacramento City Council adopted an emergency ordinance to establish a temporary moratorium on evicting residential tenants unable to pay rent due to a loss of income
caused by the Coronavirus Disease 2019 (COVID-19). March 24, 2020, the emergency ordinance was amended to add commercial tenants and to waive late fees. The City’s ordinance allowing non-payment of rent was been extended based on the Governor’s Executive Order issued May 29, 2020.
The City’s ordinance was extended to July 28, 2020. June 30, 2020, the Sacramento City Council amended the emergency ordinance to limit the temporary moratorium on evicting commercial tenants impacted by COVID-19 to only retail tenants (as defined in Chapter 17 of the City Code) located on the first floor of buildings.
For all other commercial tenants, such as office uses and retail tenants, on the 2nd floor of shopping centers, the moratorium expires June 30, 2020. All tenants still have 120 days after the expiration of the related moratorium to pay back rent and avoid eviction under the City’s ordinance. For all residential tenants and first floor retail tenants, the date would be until November 25, 2020. For all other commercial tenants, the date would be until October 28, 2020.
WHO IS PROTECTED?
This moratorium is applicable for residential and ground-floor retail commercial tenants within the limits of the City of Sacramento only. All residential tenants are protected regardless of when the rental unit was built. Single-family residences and condominiums that are rented are included in this ordinance. All commercial tenants are also protected.
July 1, 2020, commercial tenant protections were limited to retail businesses located on the first floor (i.e., street level) of a building. However, the business would not have to front a street, so all first-floor tenants in a retail shopping center would have the same protection
WHAT WAGE LOSS REASONS ARE COVERED?
RESIDENTIAL TENANTS:
The loss of income must be related to the impacts of COVID-19 due to the following:
1.)The tenant is sick with COVID-19 or has to care for a member of the household who has COVID-19
2.) The tenant experienced a lay-off, loss of hours, or other income reduction due to COVID-19
3.) The tenant complied with a recommendation from a government agency to stay at home, self-quarantine, or avoid congregating with others.
4.) The tenant had to miss work to care for a home-bound school-age child.
WHEN WILL TENANTS BE REQUIRED TO PAY FULL RENT?
Residential and retail commercial tenants will be required to begin paying full rent after the ordinance expires on July 28, 2020.
WHEN MUST TENANT PAY BACK-RENT?
Residential and commercial tenants who were afforded eviction protection have up to 120 days after the expiration of the City’s ordinance to pay their landlord all unpaid rent. During the 120 day period, the protections against eviction apply for such tenants. And no late fees will be owed. Based on the current order expiration date of July 28, 2020, unpaid rent is due by November 25, 2020, for all residential tenants and first floor retail commercial tenants. Please note that for other commercial tenants who were protected through June 30, 2020, unpaid rent is due October 28, 2020. If the tenant fails to repay the unpaid rents by the due date, the tenant may be subject to eviction.
WHAT IF A TENANT WAS LATE PAYING RENT BEFORE THE ORDINANCE WAS ADOPTED?
The ordinance does not prevent a landlord from evicting a residential or commercial tenant who failed to pay rent when due before the ordinance was adopted or for any other lease violation.
WHAT HAPPENS IF THE LANDLORD MOVES FORWARD WITH AN EVICTION?
If a tenant complies with the requirements of the temporary moratorium which includes providing proper written notification and supporting documentation, a landlord cannot serve an eviction notice, file or prosecute an unlawful detainer action based on a three-day pay or quit notice, or otherwise endeavor to evict the tenant for nonpayment of rent for the months of April through July. A tenant may use this ordinance as an affirmative defense in an unlawful detainer or other action brought by a landlord to recover possession of the rental unit. A landlord who violates this eviction prohibition is subject to administrative penalties up to $25,000 pursuant to chapter 1.28 of the Sacramento City Code.
WHAT HAPPENS IF A TENANT FAILS TO PAY FULL RENT AFTER JULY 1, 2020 OR AUGUST 1, 2020?
A tenant who fails to pay rent is subject to eviction in accordance with state and local laws. However, the Judicial Council adopted temporary rules suspending unlawful detainer proceedings for 90 days after the state of emergency period ends. This court action and Governor’s order do not establish any new tenant rights or defenses to an eviction.
Governor Gavin Newsom Announces Major Financial Relief Package: 90-Day Mortgage Payment Relief During COVID-19 Crisis.
Governor Gavin Newsom today announced that financial institutions will provide major financial relief for millions of Californians suffering financially as a result of the COVID-19 outbreak.
“Millions of California families will be able to take a sigh of relief,” said Governor Newsom. “These new financial protections will provide relief to California families and serve as a model for the rest of the nation. I thank each of the financial institutions that will provide this relief to millions of Californians who have been hurt financially from COVID-19.”
The has secured support from Citigroup, JPMorgan Chase, U.S. Bank, and Wells Fargo and nearly 200 state-chartered banks, credit unions, and servicers to protect homeowners and consumers. Under the Governor’s proposal, Californians who are struggling with the COVID-19 crisis may be eligible for the following relief upon contacting their financial institution:
90-Day Grace Period for Mortgage Payments
Financial institutions will offer, consistent with applicable guidelines, mortgage payment forbearances of up to 90 days to borrowers economically impacted by COVID-19. In addition, those institutions will:
Provide borrowers a streamlined process to request a forbearance for COVID-19-related reasons, supported with available documentation;
Confirm approval of and terms of forbearance program; and
Provide borrowers the opportunity to request additional relief, as practicable, upon a continued showing of hardship due to COVID-19.
No Negative Credit Impacts Resulting from Relief
Financial institutions will not report derogatory tradelines (e.g., late payments) to credit reporting agencies, consistent with applicable guidelines, for borrowers taking advantage of COVID-19-related relief.
Moratorium on Initiating Foreclosure Sales or Evictions
For at least 60 days, financial institutions will not initiate foreclosure sales or evictions, consistent with applicable guidelines.
Relief from Fees and Charges
For at least 90 days, financial institutions will waive or refund at least the following for customers who have requested assistance:
Mortgage-related late fees; and
Other fees, including early CD withdrawals (subject to applicable federal regulations).
Click here for details on how to apply for relief.
https://covid19.ca.gov/get-financial-help/#top
Loans held by a financial institution may be serviced by another company. Please note that financial institutions and their servicer are experiencing high volumes of inquiries.
COVID19.CA.GOV
Get financial help
As you're all probably aware by now, the Country is experiencing real crises - on many levels. Over the last few weeks, I have been inundated with questions with regard to impending legislation, laws or directives related to residential and commercial property management! It is my mission to support our Tenants and Landlords, who have been directly impacted by job/income loss related to widespread business shutdown/layoff/furloughs or afflicted with a medical condition as the result of COVAD19 and/or exposure.
Our mission, here at Stone Creek Properties, is to do everything possible to mitigate our Client's losses while maintaining a compassionate and legally compliant position - as we address these daily challenges. I will continue to keep you informed as reliable information becomes more available.
As of 3, March 2020: Ordinance Amending Section 5.156 Establishing a Temporary Moratorium on Ecivcting Tenants.
"The tenant will have to notify the landlord that their inability to pay rent was due to wage losses caused by the COVID-19 before the rent payment is due, and provide documentation to support the claim. Once the local emergency declaration is repealed, this amendment to the ordinance would be repealed. A tenant would then have to make arrangements with the landlord to pay the back rent owed, but no late fees could be imposed.” Sacramento County Court WILL NOT hear eviction complaints regarding non-payment of rent for at least 4 months or such time as the Executive Order has been lifted. Ironically, the Courts are currently closed until 15, April 2020 and, currently, no way to attempt adjudication.
Please see the new Executive Order dated 4, March 2020:
https://www.gov.ca.gov/wp-content/uploads/2020/03/3.16.20-Executive-Order.pdf
GOV.CA.GOV
www.gov.ca.gov
A wonderfully clean like New home. Downstairs there is a bedroom and full bath. The kitchen has a large island with granite countertops and stainless-steel appliances including the refrigerator. The kitchen and family room are together which gives you that great room'' feel and they have a beautiful wood floor. There is also a formal living room and dining room. Upstairs you will be blown away with the large open space at the top of the stairs. You could make this into an incredible movie room or a large playroom. One wall is almost completely covered with a large built-in bookcase. The master bedroom has double sinks, a separate show and oval tub and walk-in closet. The laundry room is upstairs, the washer and dryer are included. The backyard has a stamped concrete patio plus a sitting area.
What are My California Landlord’s Duties Regarding Mold?
The state of California recognizes that the presence of toxic mold in a rental home or unit can lead to severe health problems in tenants, thereby violating the implied warranty of habitability. The implied warranty of habitability is a warranty implied by law in all residential leases that the premises should be fit for human habitation, and must remain that way throughout the duration of the lease.
California maintains a law called a “written disclosure law for mold.” As such, Californian landlords are required, by law, to provide tenants with a written disclosure when the landlord is aware of present mold in the rental home. Written disclosure is a document that is signed by both the landlord and the tenant. This California written disclosure law applies when there are large amounts of mold in a rental home, and that amount of mold exceeds safe exposure limits. Additionally, the law applies if the mold is a threat to the tenant’s health.
According to California law, landlords are not required to test the rental property for specific levels of mold. However, as of 2016, California law does require that landlords repair or remediate any mold found. California does not require that a landlord provide a written notice of mold growth that had been previously and properly repaired. Further, it is important to note that no other landowner may be held liable for damage caused by “an Act of God.” However, a property owner such as a landlord may obtain natural disaster insurance in order to cover damages caused by these “Acts of God.” Mold damage is typically included in such insurance policies.
Tenants do have a responsibility to do what they can in order to keep the rental home free of mold. It is important that tenants report maintenance issues to their landlord, as soon as the issues become apparent. If it is found that the tenant simply ignored the issue, or caused the leak/flood and didn’t want their landlord to know, then the tenant may be found responsible for the damage. Under California Code, a reasonable time is deemed to be within 30 days from the day that they received notification from the tenant. If the landlord does not respond, then a tenant may take action against the landlord.
The next COVID-19 crisis: The coming tidal wave of evictions!
Like the record 2.82 million Californians filing for unemployment benefits, the coronavirus pandemic means loss of income for many tenants! Many tenants have informed the landlords that they are going to have less than full rent payments for the time being.
The landlord can ask for a statement from the tenant's employer to show that the business has closed, or has severely limited its operations, and the tenant has been directly affected, now receiving partial pay or no pay. This is necessary for the tenant to justify any rent deferral!
The landlord can request documentation from the tenant, including bank account statements, to see exactly how bereft the pandemic had left them but the landlord should know that there is no legal requirement for tenants affected by COVID-19, to present to their landlord a summary of their assets, nor is there a requirement that tenants exhaust savings or spend money intended for food or medicine on housing first.
Should the tenant decide to withhold rent, or ignore a “payment notice” from the landlord, they aren’t at risk of eviction, at least not yet. State and local “eviction moratoriums” mean that the legal operations of evictions are on pause. Physical evictions are barred. Eviction courts are closed. Rent missed now isn’t due until after the crisis is over and the emergency orders have been removed. It is strongly suggested that, before you consider evicting your tenant, seek legal or professional advice and service. This could save you thousands of dollars.
