On October 8, 2019 a new statewide rent control law, AB1482 also known as the “Tenant Protection Act of 2019” was passed that, among other things, limits the ability of landlords to raise rents and includes limitations on the ability of landlords to terminate leases commonly known as “just cause for evictions”. This post will provide an overview of the Tenant Protection Act of 2019 (“TPA”) and its effects, all of which are discussed in separate posts.
The TPA contains a number of provisions that will have a profound effect on landlords and will add to the cost and complexity of residential leasing. Among other things, it includes restrictions on rent increases and a relocation payment to tenants equal to one months rent at the time a landlord terminates a tenancy, and significant limitations on landlords ability to terminate leases. Further, the TPA requires updating of all leases to comply with the law, to identify and maintain exemptions to it, the loss of which can be costly.
The provisions related to eviction protections and limitations are found in Section 1946.2 of the Civil Code, the “Just Cause Protections”. The Just Cause Protections only apply if a tenant has continuously and lawfully occupied a residential real property for 12 months (CC1946.2(a)). If an additional adult tenant is added to a lease prior to any tenant having continuously and lawfully occupied the property for 24 months then the Just Cause Protections will only apply after 12 months from the date such additional person is added or upon one or more of the tenants “continuously and lawfully” occupying the property for 24 months.
There are a number of categories of residential property that are not covered by the Just Cause Protections. Most relevant to those in the business of leasing residential units is an exemption for residential units that were “issued a certificate of occupancy” in the last 15 years (CC1946.2(e)(7). Also exempt are owner occupied single family residences even if there are up to three separate units on the property (CC1946.2(e)(5). Owner occupied duplexes are specifically identified as exempt (CC1946.2(e)(6). If an owner of a property is renting rooms in a single unit, for example, renting one or more bedrooms but sharing kitchen space or bathrooms, then it is also exempt. Finally, where a property is in a jurisdiction in which a local ordinance requires for just cause for eviction and that ordinance was adopted on or before September 1, 2019 then the local ordinance will control. If the local ordinance was adopted or amended after September 1, 2019 then, to the extent it is more protective, it will apply.
Additional standard exemptions are also included, for example: transient and tourist hotel occupancy; hospitals, religious facilities, extended care facilities, licensed residential care facilities for the elderly, adult residential facilities; school dormitories; condominiums so long as the owner is not a REIT, corporation, limited liability company that has a corporation as a member (a “Qualified Condominium”).
In order for a Qualified Condominium to be exempt special notice in the form approved must be provided to the tenants. After July 1, 2020 the notice must be included in the rental agreement. As a result all leases of Qualified Condominiums should be updated to include the special notice where applicable or risk losing exempt status.
Lease Updating and Tenant Relationship Management
Every landlord should update their lease forms and other tenant documents, failure to do so could cause a landlord to lose their exempt status and cost them or future owners additional cost and complexity. If would need assistance updating leases or managing tenant relations feel free to contact Brightwork Law or call (925) 257-2942.