Rent Control Question - Rent Increase for roommate - The full version (real estate)

[scfinla]

Ok... so I posted only a portion of the full story with my current landlord. I've seen more postings with more information, so I thought I would share this with you all and welcome your comments & advice.

here goes...


At the time I moved into the property in 2003, there were 2 tenants. When the lease was renewed, I was named as the sole tenant, but with the option of having a roommate (with Landlord approval), which I did. At the time of the property was sold, I had a roommate which my new landlord knew about. He said nothing. During this time, the landlord was (and still is) experiencing financial difficulties with the property along with the adjacent property he purchased at the same time. He is currently in default on his property taxes and has been threatened with foreclosure action based on the default of his mortgages. The lease expired on February 1, 2007 and reverted to month-to-month tenancy under the same conditions as the lease.

Sometime around the end of 2006, the landlord had stated that he was considering ‘moving in’ the unit and we would be asked to vacate the property. Being in real estate development and property management myself, I reviewed the statutes and ordinances surrounding California Landlord & Tenant law and was well versed in the definitions of the rules & regulations surrounding the eviction procedures. I shared that with my landlord along with my concerns to be sure that we were given the proper notices to vacate. He assured me that he would do so. I maintained communication with my landlord and inquired about the status of his decision to move into the unit. That continued through April and I shared with him the dollar amount that he would have to pay me when asking me to move so he could move into the property. It was at that time that I also inquired about replacing my roommate that had moved away for his job and shared with him my concern that he would soon ask me to move out. He responded that I should go ahead with the new roommate as he had no definite plans of moving in. So I did just that. At no time did he mention additional rent.

The landlord sent me a notice of rent increase via registered mail on or about December 7, 2007 wherein he indicated that he was raising the rent by 5%. Fine… I’m ok with that. But at the same time, he had stated that he would no longer continue to allow for the reduction in rent for the sanitation charges that I was paying. I directed him to the section of the lease that reflected that the landlord would pay for both water and trash. A few days later, the landlord acknowledged that part of the lease and rescinded his decision of not allowing the reduction. On December 14, 2007, I received another piece of registered mail wherein the landlord indicated that he would be increasing the rent by an additional 10% for the ‘additional tenant’. I naturally contacted the landlord immediately to let him know that I did not believe he was within his right to do that since I had never exceeded the number of occupants from the original inception of occupancy of the unit.

The landlord stated that I was incorrect and that the increase would stand as is effective February 1, 2008. He indicated that the lease allows for a roommate, but with the approval of the landlord. I asserted that I had a roommate at the time he purchased the building and at no time did he increase the rent. When my roommate moved away for his job in May 2007, I received the go ahead from the landlord to seek a replacement roommate; which I did. It was not until this last notice that he had decided to bump up my rent by 10%. It is my opinion based upon how the Ordinance reads, that this is not a legal action by the landlord. If anything, he is in violation of said Ordinance. I also believe that because he continued to accept my rental payments for the unit since he purchased the building in September 2006 and that this rental payment was for the unit that contained 2 occupants, he has effectively acknowledged that there are 2 occupants and continued to approve of same without ever increasing the rent.

This is how I personally feel the situation is with the landlord…. He purchased both properties with the idea that he could evict the current tenants, pay the relocation fees (which were not yet significantly increased) and seek market rent for the units. That is about $2500 per unit and given that he currently has 3 tenants, (myself, a married couple, and a single mother with her son) that would increase the property revenue dramatically since we’re paying nearly $1700 per month. He would “move in” to one of the units (actually, just having his mail sent there) and seek a rent that was more in line with the current market rate. He would give the appearance to the Rent Control Board that the property was owner-occupied and therefore not subject to the rent control ordinances. Once he realized how much money he would have to pay out nearly $35,000 in relocation fees for the current tenants, he found himself in financial trouble. Because of that, his finances were not so great as he took on too much responsibility with respect to the purchase of the two properties which lead to his default on property taxes and subsequent default on his mortgages. So it would be my opinion that he is grasping at any straws to increase the revenue stream in order for him to maintain his properties.

He has asked me to be reasonable and that ‘fair play’ should be the prevailing factor since he didn’t increase the rent last year but that was his own decision and I am very much aware that you cannot play ‘catch-up’. I have no issue at all with his increasing the rent this year by the maximum allowed which is 5%, but I will not tolerate his apparent violations of the Landlord/Tenant and rent control ordinances. His loss based upon his failure to be well versed in rent controlled properties shall not be passed onto me. What is it they say about ignorance?

I would appreciate any assistance or guidance you can offer.

[SandyCo]

I agree with everything you've said. In fact, if he or a member of his immediate family don't occupy the unit if you're evicted, you could get in touch with the proper authorities, and he could end up in big trouble. I'm a little shaky on the 10% increase for an additional tenant, although I think you're right about the landlord's motivation to increase his revenue.

I found this Rent Stablization Board bulletin. Maybe this will help.

http://www.cityofla.org/lahd/racreg310.pdf

[scfinla]

Thank you for the response. My thing is that the 'additional tenant' is a replacement for the roommate that moved away and was approved by the landlord and had a roommate at the time the new landlord bought the building. So, I will contend that he cannot now go back and try to collect the 10% for my roommate. He is also threatening eviction proceedings if I don't pay up. I'm waiting for an attorney that I've contacted to give me the advice I need at the same time, I'm waiting on a response from the RSO.

I'm very confident in my belief that I am in the right here and will relish in the thought of providing that information to the landlord.

[SandyCo]

Please let us know what happens. This is one of those gray areas; I'd like to know how this is resolved. Thanks!

[mommabear2]

You're saying the owner is in default? Hmmm, I think I'd be more worried about the fact that the property might be heading into foreclosure... He may be doing this to you in an attempt to get more cash flow to pay the mortgage. If the property goes into foreclosure, rent control will not save you from anything as tenants rights become severely limited. If the banks take position, I doubt you'll be entitled to the apartment, relocation fees, or even ANYTHING for that matter. It's a bad way to lose a home... good luck... I hope your landlord is able to pay his taxes and mortgage for your sake...

[4tishy]

I am dealing with the almost exact same situation. THe LAHD allowed the landlord to get away with calling my roommates' additional tenants, when there were in fact 'replacement' tenants under the RSO. I have been badly gamed by LAHD enforcement since 2005 and am out a lota of money. The city pretend that the inception of my tenancy was my third lease, and ignored the shared prior leases, thus my last lease, alone was used against me even thought it just said prior approval of any roommates, which she never enforced. She also overcharge one year with 2 RC increases and this was noticed by my forcing the issue with LAHD. LAHD was going to get me back $2100, on that point, but refused on the 'additionals' and were 'forcing me to pretend 'dates' of claim, as though I never existed prior what what they used as the defining lease, which was completed alone due to reconstruction. I am out over 10,000. was harassed so I finally moved out. They short changed me on deposit, also (new mgmnt) pretending that they don't know of my tenancy prior to my third lease. Legally, I do not know what to do here. 10K, is a lot in this economy! Help if you can. I think to make a claim against the city and/or if the landlord, I don't know what to claim......Mgnmt Co. gives me the run around......