Moderate-income households take it on the chin in today’s tight rental housing market. Demand for rental apartments is rising because high housing costs have pushed more families to rent. Now our region is attracting employers paying higher salaries and those job-takers need housing too. Yet Beverly Hills has not meaningfully increased the supply of apartments over the decades, and when housing is built it is predominantly luxury condominiums. We take a look at one recent development to see how these dynamics play out to the disadvantage of residents who rent in Beverly Hills.
When a tenant receives a cash-for-keys buyout offer her logical question would be whether the money is worth the trouble of moving. Today’s Westside market is tight and the cash may not stretch as far as she would like. But is that even the right question to ask? Rather the tenant with a buyout offer in hand should ask, What is my vacancy worth to the landlord? As it turns out, quite a bit.
The city has identified two objectives for rent stabilization: to enhance the stability of renting households and to maintain and improve rental housing. But when landlords put profit before maintenance neither objective is accomplished. There is no clearer sign of disinvestment in housing than a tarp on the roof. And it comes at the expense of our community and the apartment houses we call home.
Last week City Council voted to make landlords and tenants a majority on our own commission and to task that commission with discussing the policy specifics of the next rent stabilization ordinance. That is a big change in direction, but we wouldn’t it from a visit to the city’s rent stabilization program website! In lieu of a recap of that recent development, the website still posts the announcement for last week’s meeting…as if it were still upcoming.
There isn’t even is a posted link to the meeting video. This communication breakdown is not new. We’ve griped about the lack of outreach. Where is the RSO bulletin or newsletter? Where is the monthly or quarterly email update? Where are the tenants’ rights seminars?
The Community Development Department’s webpage needs some help too. The mission is too focused on code enforcement and development and not enough on ‘community.’
Communication is simply not job #1 but it should be. Check out Santa Monica’s rent stabilization webpage. There is just a ton of information there. Or West Hollywood’s RSO webpage. Packed with news-you-can-use! Beverly Hills need not reinvent the wheel. Crib this stuff!
Why keep tenants better informed? It keeps us engaged. Give us a simple process timeline so where know where we are. Let us know what are the next steps as the process changes. At least let us know that the city has not dropped the ball on rent stabilization.
Finally, it is not only the rent stabilization program that’s falling down on what should be job #1. Its the city’s whole communication apparatus. How often does City Hall communicate with you? Hardly ever. Even the city’s weekly online newscast (vimeo) gives us the cold shoulder. Rent stabilization affects 7,700 households in Beverly Hills but you wouldn’t know it from Beverly Hills This Week. Not a mention of it over the past ten weeks.
The rent stabilization websites for West Hollywood and Santa Monica are chock-full of news-you-can-use: tenant-specific workshops (both basic and advanced), archived program newsletters, FAQs on topics like pets and security deposits and much more. Each city also provides a well-organized overview of the rent stabilization ordinance as well as state tenancy law. Why not Beverly Hills?
A tenant advocate’s highest praise is to be called out by a landlord in print or in a public forum for being a “zealot” or a “dog-and-pony show orchestrator”. It is even more gratifying to be the focus of an amateur gumshoe investigation that purports to uncover some measure of hypocrisy for calling for a sustainable rent stabilization ordinance. Behold this letter to Apartment Age magazine from a local landlord. It’s practically an expose!
Vice-Mayor John Mirisch posted a rhetorical question on Instagram: Do Communists celebrate Christmas? “The Apartment Association of Greater Los Angeles evidently thinks so. They sent our mayor a ‘present’ equating our efforts to craft a rent stabilization ordinance with Communism.” The Apartment Association likes to equate rent control with socialism but the ‘red scare’ tactic invokes the specter of Leninism. That implies no classes, no private property and of course no religion. So it is ironic indeed to make a Christmas gift of the Communist Manifesto!
The New York Times today published another installment in its year-long series focused on predatory landlords and the damage they do to tenants. ‘Bad Landlords Dodge Full Bite of a Watchdog’ drills down to learn why recidivist property owners aren’t held accountable by City of New York: lax enforcement, paltry penalties, and a bureaucracy insufficiently committed to protecting tenants. Sound familiar?
City Council came in for some bruising this week from the Courier, which took the city to task for rolling back some tenant protections at the November 20th RSO study session. The Courier has done a good job of tracking the rent stabilization policy process through twenty months of Council and commission meetings, facilitated dialogues and urgency ordinances. In the same issue the Council’s action comes in for criticism from Steve Mayer and Thomas White, both longtime community advocates. And I recap in my letter to the editor my top concerns. (I reprint it here.)
One of the more frustrating aspects pro-tenant work is recognizing how the deck is stacked against those who rent. There are many provisions in the law to keep the tenant in line. Keep a pet or live with an unapproved partner or roommate? The 3-day notice may come. A few days late (or a dollar short) on the rent? Sudden death for the tenancy. Yet the rules are much more lax for landlords, and the bad apples among them withhold repairs, enter the unit unlawfully, and even retaliate. Holding them to account is the tenant’s challenge because often the city won’t.
Landlords claim that we tenants were a happy lot before City of Beverly Hills mucked around with the rent stabilization ordinance last winter. They say they hardly ever hit us with excessive rent increases; that properties were maintained just fine; and that no-cause eviction was not even a thing. So why fix what wasn’t broke? To back up those claims they have analyzed four years of Code Enforcement complaints. However this latest Hail Mary attempt to tank our rent stabilization program will persuade nobody that the system didn’t need fixing.
When rental property owner Sharon Darnov appeared before City Council on August 7th she shared an observation. “There are good landlords and there are bad landlords,” she said. “There are good tenants and there are bad tenants.” Darnov didn’t talk about bad landlords but did have a word to say about ”extortionists” and “grifters” among her tenants. Every landlord has a story! Watch the video for Darnov’s story.
The HR&A analysis underpinning the rent stabilization policy discussion has done our city a service: policymakers, landlords and tenants now have some idea about the character of rental housing stock in Beverly Hills and the tenants who inhabit it. Our city has had a rent stabilization ordinance on the books for four decades yet our city had no accurate tally of rental properties. We had no comprehensive assessment of character or ownership. Nor did the city understand the rental market and where Beverly Hills fit in. The city’s rental unit registry and the HR&A Advisors study has filled in those gaps.
Landlord Kevin Davis penned a letter to the Courier in the June 13th issue that warned of a “massacre” upon those who lease apartments should the Beverly Hills rent stabilization program continue. While we are accustomed to hyperbolic bloviating by property interest associations (like the hammer-and-sickle theme from the Apartment Owners Association of LA), when landlords offer specious and unfounded claims they should be knocked down. Here is the Renters Alliance rebuttal was published in the July 20th issue.
A couple of months ago I got to thinking about how Beverly Hills calculates allowable annual rent increases. A formula tied to consumer prices long kept increases very low for Chapter 5 tenants. Indeed in a period of low inflation Chapter 5 increases long averaged about 1% annually. Then it jumped to an average of 1.7% this year in a reviving economy. But now the annual rent increase effective in August nearly doubles to 3.3%. What’s going on?
To a tenant accustomed to the 3% cap on annual allowed rent increases, the city’s announcement that the allowance has risen to 4.1% was a surprise both for the change and for the magnitude of the jump. As I explained in a recent post, the bump-up may have been predictable given the change in consumer prices lately even if the increment was larger-than-expected. The culprit? Rising rents!
City Council kicked-off the extended rent stabilization reform discussion in January of 2017 without much discussion about goals and objectives. Councilmembers heard plenty from tenants about rising rents, but they left unresolved the question of who should benefit from rent control. They heard about capricious landlords and predatory practices but they recommended no new tenant protections to keep renters housed. While no specific objective was identified for rent stabilization, the Rent Stabilization Program has found one – and it needs revision.
Landlords are making significant improvements to their properties in an effort to enhance curb appeal in today’s hot real estate market. Paint and landscaping is one way. Remodeling vacant units to fetch higher rents is another. Maximizing fees for late payment, pets, and other ancillary revenue streams yet a third way. But key to what the real estate industry dispassionately calls ‘market repositioning’ is getting rid of longtime tenants.
Last year Beverly Hills landlords saw their allowed annual rent increase drop from 10% to 3% and the city imposed a relocation fee for any involuntarily-terminated tenancy. They lost the battle for the rental unit registry and the approximately one-in-ten who had long avoided paying business taxes finally had to obtain the required business license. If 2017 was a tough year then 2018 looks only worse if the Affordable Housing Act ballot initiative wins the approval of voters in November.
California voters may have an opportunity come November to overturn the state’s Costa Hawkins law, which prevents localities like Beverly Hills from extending protections to all who rent housing. This “gift to landlords” (in their words) has handcuffed local officials for decades. With the Affordable Housing Act initiative about to qualify for the ballot, the stakes are high and landlords are apoplectic at the prospect. Let’s take a look at the law’s affect on rental housing in Beverly Hills and the proposed initiative’s objectives.