New Laws For 2025
1. Does Not Pay to be a Residential Landlord in a Rent Control City
New case entitled Fox Hills Canterbury Co, v City of Culver City. In the Fox Hills case, the owner received building permits (2017) to totally rehab/renovate apartment building. Completed 117 units and spent approximately $20 Million Dollars by 2020.
In 2020, the City adopts a rent control ordinance forbidding landlords from relocating tenants from units unless tenants are allowed to return at the same rent, even if the units are substantially upgraded.
Owner filed lawsuits, claiming vested right after permits had been issued in 2017 and approximately $20 Million Dollars had been spent on upgrades to be exempt from the ordinance which was not adopted until 2020. The judge disagreed, naturally. The owner just blew $20 Million Dollars with no upside in ever getting his money back or a return on his investment because he cannot raise the rents from the previous rental rates.
Comment: Why would any landlord want to improve his building or make any premises nice if there is no financial incentive? Going to be lots of buildings in rent controlled cities not looking so good for many years to come unless the voters wake up and say no to these crazy lib policies.
2. New Impediments for Landlords to Navigate Through
a. Civil Code § 1950.5 as amended, requires landlords to photograph each unit immediately:
(i) Before the tenant moves in
(ii) At the end of tenancy
(iii) Before and after repairs
b. AB 2493 requires that landlords who run credit checks to give a copy of the report to applicants whether accepted or rejected.
c. Renters now have the option of demanding landlords report positive payment information to at least one nationwide credit bureau. This law was signed September 19, by Newsom. Only applies to buildings of 15 units or more.
Comment: The hits just keep coming if you are a residential landlord. Libs will have to one day realize that you just cannot keep piling it on without a voter revolt, like the one we just experienced.
3. Starting January 1, 2025, the Buyer-Broker Agreement is Required Per Civil Code § 1670.50
The agreement is to be signed prior to making an offer to purchase real estate by buyer.
The agreement must state:
a. Broker’s total amount of compensation
b. Services to be rendered broker/agent
c. When compensation is due and deemed earned
d. The date agreement expires, Term of the agreement cannot exceed 90 days.
4. AB 2347 is a New Law Which Extends Time to Answer Unlawful Detainer Complaints From 5 Business Days to 10 Business Days
This starts January 1, 2025.
Comment: The vast majority of evictions are for failure to pay rent. The dem/libs are just giving non-paying tenants more time to stay there for free. It will cost landlords more lost rent. It usually takes a couple of months at least to evict tenants if they file an answer. This will extend eviction time as well.
5. Newsom Vetoes California Dream For All Bill That Would Have Provided $150,000 For Downpayment on Homes For Illegals!
Newsom cites huge fiscal impact on the State on the huge budget deficit is already existing.
Comment: Good for him. The libs are upset naturally. Money should never stand in the way of giving out freebies to their potential new voters.
6. California Supreme Court Rules That The Governor Cannot Shake Down Property Owners For Exorbitant Development Fees in Exchange For Issuing a Building Permit
In Sheetz v. El Dorado County, the court ruled charging $23,000 labeled Traffic Impact Fee to an owner who applies to build a small home in rural El Dorado County in exchange for a building permit was unlawful.
The fee must be closely related and proportional to adverse conditions specifically caused by the development and no more.
About the Author
Disclaimer:
Scott Souders is a real estate attorney who has practiced real estate law in excess of 45 years in Southern California. The Real Estate Law Update cites cases or statutes which are summarized and should not be relied upon without fully reading the cases or statute in the advance sheets and shepardizing the same and consulting with your own attorney.
About the Author
Disclaimer:
Scott Souders is a real estate attorney who has practiced real estate law in excess of 45 years in Southern California. The Real Estate Law Update cites cases or statutes which are summarized and should not be relied upon without fully reading the cases or statute in the advance sheets and shepardizing the same and consulting with your own attorney.
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