Rent Issue Simmers
Open letter to Council decries no-cause eviction ban
To Mayor and Councilmembers:
As a small income-property owner and long-term Realtor in Alameda, I heartily object to the Council’s May 21 vote to eliminate the no-cause provision in Ordinance 3148. The small number of true no-cause evictions since Ordinance 3148 went into effect does not warrant this change.
No-cause has mostly been used to evict problem tenants or to vacate tenants if the owners want to refurbish and sell their properties. No-cause has been the only viable way to evict problem tenants. The numbers of no-cause evictions are low and often do not show the true reasons for their use. Its use for raising rents is not happening anymore due to relocation fees and very small rent increases allowed after a no-cause eviction.
Many owners simply wanting to sell, exit the rental business and refurbish their properties have used the no-cause because it allows new owners to stay in the rental business if they so desire. Eliminating no cause will mean that sellers of a single-family, condos, townhomes or Victorians can use “going out of the rental business” and vacate the property to fix up for sale.
Using “going out of the rental business” reason to vacate properties means the new owners will not be allowed to rent out their properties for at least five years. The same applies to owner move ins. With its vote, the City Council, will now cause a decrease in available rental units in Alameda.
Even the threat of eliminating no-cause (the only viable means to evict a difficult or criminal tenant) has already caused many small income-property owners to sell their rental properties. I personally have helped facilitate the sale of two properties in the last year due to fear of the changes the City Council is proposing. Other Realtors are telling me the same thing.
I fear that the City Council is failing to acknowledge that harsh, rather than moderate, rent control in every known case on record has led to fewer rental units, higher rents and less diversity in cities. Economists agree.
Does the City Council think the results of its actions will be any different in Alameda? Ordinance 3148 was basically working to avoid the flight of small income-property landlords from the rental business. By favoring a no-cause provision, the City Council is exposing small income-property owners to extreme difficulties in court when attempting to evict criminal or obnoxious tenants. These tenants could threaten their neighbors, who, in turn, could fear retaliation for testifying against the evicted tenants.
High relocation fees and moving fees, the low rent increases allowed and the cost to fix units for new tenants — unless selling properties — combine to mean that landlords do not evict good and reliable tenants. This has not been happening under Ordinance 3148.
Luckily for small income-property owners who want to avoid the proposed rent control, Council cannot stop them from selling their properties. As in every case of severe rent control, Council’s actions will have the same proven result in Alameda as they have in San Francisco, Oakland and Berkeley: fewer rental units, higher rents, less diversity and more criminals.
Telling landlords that they must pay relocation fees based on monthly rents far above what they actually charge tenants is completely outrageous to housing providers. For landlords who have kept their rents low, this is a slap in the face and another cause for the upsurge in sales of rental units in Alameda and tax-deferred exchanges to other states that have reasonable rental policies.
The more unjust rules the City Council proposes to govern long-time considerate landlords, the less it helps renters. Alameda’s rents are currently below those of surrounding cities. That will soon change due to supply and demand. Even lesser diversity will result.
Council must realize the outrage landlords feel when Council dictates that landlords must pay large tenant-relocation fees within a few days if earthquakes of other natural disasters damage their properties.
Landlords themselves may be out on the street after such disasters. This part of the ordinance goes against state-recommended policy. California does not suggest mandated relocation fees in the event of natural disasters. Councilmembers’ statements that insurance will cover tenant relocations are not true. Due to the high cost, very few small income-propety owners can afford earthquake insurance in the first place. Even if they have earthquake insurance, it does not cover relocation fees.
The only party who can get that type of insurance is a tenant. One more reason for landlords to get fed up, exit the rental business and invest elsewhere.
The city’s has requested that landlords provided information on their private properties: date of purchase, purchase price, how long each tenant has been in residence, the amount of their rents and copies of deeds and escrow instructions This is simply beyond belief. As far as I know, the city has not asked tenants for their private information.
As far as I could learn, the city has approved only one capital improvement plan tor a rental property in the last year, The look and safety of the city’s residences and other buildings are hanging in the balance due to the virtual impossibility of an owners to relocate tenants, make improvements and recover their expenditures.
This is not acceptable. Will Council take any responsibility if renters die in an earthquake or other disaster because the city failed to approve capital improvements?
I personally think Council should give consideration to the fact that the city has some responsibility for the results of changing Ordinance 3148 to a more radical rent control. The safety and beauty of Alameda are at stake.