California has some of the most tenant friendly laws in the nation. This is no surprise to a professional Property Manager. During the two plus years since the COVID pandemic began, California law makers have taken advantage of the situation to implement more restrictions on landowners, including statewide rent control and “Just Cause” evictions.
As Gavin Newsom stated in Jan 2020, “With 1482, California will boast the nation’s strongest statewide renter protections”. That was not an overstatement. Since then, many temporary renter protections have been extended, or made permanent; as California’s housing crisis worsens, it is likely this trend will continue.
What is rent control?
Although it does not apply to all types of properties, including most Single Family Residences, rent control is now statewide. What does this mean? In most areas, a Property Manager, or landlord may only increase the rent by 5% plus the area’s Consumer Price Index. With current inflation, the total amount rent can be increased is nearly 10% in some areas. Unfortunately, due to the moratorium on rent increases during COVID, many rent amounts are significantly below 10% of Fair Market Value. If you read about rent control, you will notice a hesitation to call it such. Politicians fear the term “rent control” will scare off investors, and actually worsen the housing shortage. They are correct in their assumption. While owners are experiencing ever increasing costs of repairs, remodels, and new construction, their ability to mitigate losses has been severely affected by these new restrictions.
It is also worth noting, there may be local laws more restrictive regarding rent control than what is imposed at the state level. If the local rules are less restrictive, they are superseded by the state. However, local rent control more restrictive than the state, takes precedent. A competent Property Manager should be well informed of the local laws regarding rent control.
What is a “Just Cause” eviction?
In the past, if an owner wanted their rental property vacated, they could simply serve the tenant with a “Notice to Vacate”. In most areas, the owner did not need to provide a reason to the tenant. Typically, there were some rules that needed to be followed, such as time to vacate, and proper delivery, but no need to list a cause. As with rent control, there is now a Statewide law that states Property Manager, or landlord must show “Just Cause” to evict a tenant.
“Just Cause” is described as continual violations of the rental agreement. According to an article written by, Jenna Chandler, from la.curber.com, possible violations that may cause termination of tenancy include things such as, committing a crime on the property or non-payment of rent.
Other causes that may be considered “good reason” to ask a tenant to vacate are; an owner desires to sell a property, they have the right to do so, without the tenant impeding the sale. There are specific guidelines regarding a tenant’s rights during the listing period which are described in the “Notice of Sale” that should be sent to the tenant from the listing agent, or the landlord if no Realtor is involved. The current statute also requires that the tenant is compensated for their moving expenses up to one month’s rent.
Owners also have the right to ask the tenant to vacate if they wish to occupy the property as their personal residence. Again, the only rule is that the tenant be properly served a notice, and provided sufficient time required by law to vacate.
Despite both “Rent Control” and “Just Cause” being made statewide, many areas and cities may have their own rules in place.
Again, an experienced Property Manager should be aware of local ordinances, how to properly document lease violations, and non-payment of rent.
How does a professional Property Manager help avoid the above issues?
The most important function of a Property Manager has always been, placing a well-qualified applicant. Given the ever-increasing difficulty of evicting a tenant, the importance of placing someone properly vetted has become crucial. The manager should check the prospective tenant’s credit, income, job and rental history. The manager should also be utilizing a scoring system with a defined pass/fail score. Walker & Associates has spent the last 12 years improving our tenant screening process, and as of this writing, Walker & Associates Property Management has not had to formally evict a placed tenant by our company in more than 5 years.
Simply put, every I must be dotted, and every t must be crossed for an application to be considered by Walker & Associates Property Management.
If all the above concerns were not enough to convince an owner a professional Property Manager is worth the expense, there are many other factors to consider. Do you know what property conditions must be disclosed? Do you have the correct, and up to date disclosures? Are you aware of what verbiage can be used in advertising? Where to advertise? How to properly process an application? Create an iron clad lease agreement? The list goes on and on and on.
Conclusion, Property Managers have always been well worth the nominal fee they charge. In 2022, and particularly in California, they are essential to the success of an income property owner; And will be more so in the future.