INCREASES FOR NON-RESIDENT TENANTS

A new Santa Monica Rent Control Regulation went into effect last month and allows property owners to raise the rents on apartment units that are not being used as a primary residence of the tenant. At last count, more than a dozen petitions have been filed with the Santa Monica Rent Control Board seeking the Rent Control Board’s approval for the increase in rents. If you do not believe that your tenant is using the rent controlled department as a principle place of residence, you may qualify for a rent increase. Landlords first issue notices to the tenants whose residency is in question and, thereafter, file a petition with the Santa Monica Rent Control Board. The Board reviews the petition and then can conduct a hearing with all parties testifying under oath, cross-examined, and submit evidence. If the renter does challenge the landlord’s claim, the hearing is set.

For a long time, many Santa Monica landlords have contended that tenants are misusing the rent control process by keeping vacation apartments in Santa Monica, but living elsewhere, using apartments for storage purposes, but living elsewhere, or, not even using the apartment at all but, hoping that one day they may need it. Douglas Emmett and Company, who owns the Santa Monica Shores, believes that there are many units not being used as a principle place of residence in their property.

Since there are approximately 30,000 rent controlled units in Santa Monica, it will be interesting to determine how many landlords believe that there is an abuse of the rent control process by non-residential tenants. Only time will tell how many petitions are filed and how many petitions the Rent Control Board grants, but since it is a regulation in effect in the City of Santa Monica, landlords can now seek an increase in rents for qualifying units. Of course, judicial review can also oversee the Rent Control Board’s improper denial of a rent increase.

The Rent Control Board indicates that it passed this regulation because there was pressure from lawmakers in Sacramento that a tougher law would be enacted. A state sponsored law would have put the burden of proof on the tenant to prove that they live in their apartments full time and would not necessarily have included an administrative appeal process.

Many tenants believe that this new process is an attempt to “throw them out”, but since they have never lived in the property, it is merely curtailing the benefit that was not intended and returns residential rental units to the marketplace.

If you believe that your Santa Monica tenant is not living in the apartment, please review Regulation 3304 and consult an attorney for assistance.