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Tenant Protection Act of 2019-Part 2 of 2

Tenant Protection Act of 2019-Part 2 of 2
(Just Cause Eviction Law)

What is the Tenant Protection Act (TPA)? Effective 1-1-20, the TPA prohibits, with exemptions, an owner from
evicting a residential tenant except for 15 specified reasons. There are two types of reasons: “At fault” and “No fault”.

Exemptions from Just Cause rules:
● Housing that has been issued a certificate of occupancy within the previous 15 years (new housing);
● A duplex in which the owner occupies one of the units at the commencement of and throughout the tenancy;
● A single-family residential property (including condominiums) so long as:

  1. The owner is not a corporation, not an LLC with at least one owner who is a corporation, and not a real
    estate investment trust (REIT) AND
  2. The owner gives the tenant a legally required notice of this exemption. Ownership by individuals,
    partnerships, individual co-owners, trusts, and LLCs with no corporate owners, all qualify for the exemption.

● A single-family residence in which the owner lives and if the owner rents or leases no more than two bedrooms or
units (including an accessory dwelling unit such as a “granny-flat”);
● An owner-occupied property in which the owner and tenant share a bathroom or kitchen. The law recognizes that an
owner who lives with tenants should not be “stuck” with an incompatible tenant.
● A tenant who has not continuously and lawfully occupied the property for 12 months.

Giving notice of the Just Cause exemptions:
C.A.R. form “Rent Cap and Just Cause Addendum” (RCJC) (available December 2019) may be used as follows:
          For month to month tenants: For new tenancies starting on or after January 1, 2020, incorporate the RCJC
into the rental agreement. For existing tenancies, incorporate the RCJC by using a change in terms of tenancy,
such as C.A.R. “Notice of Change in Terms of Tenancy” (Form CTT).
          For Fixed Term Leases: For new tenancies starting on or after January 1, 2020, incorporate the RCJC into the
new lease. For existing tenancies, simply provide the form as a stand-alone notice. If not already provided,
incorporate the RCJC into the lease upon any renewal or extension of existing leases.

What are reasons an owner may evict a tenant for at-fault just cause?
(1) A default in the payment of rent; (2) A breach of a material term of the lease; (3) The tenant commits a nuisance or
uses the property for criminal or unlawful purposes; (4) The tenant assigns or sublets the property in violation of the
lease/rental; (5) The tenant refuses to allow the owner access; (6) The tenant refuses to sign an extension/renewal at
the expiration of the lease/rental.

What are reasons an owner may evict a tenant for no-fault just cause?
(1) The owner is withdrawing the property from the rental market; (2) The owner intends to demolish or substantially
remodel the property. Cosmetic improvements alone do not qualify; (3) The owner, or the owner’s family members
intends to occupy the unit PROVIDED the tenant has previously agreed to allow such a termination or if a provision of
the lease permits it. C.A.R. form RCJC may be used for this purpose. NOTE: For all no-fault evictions, the owner must
pay the tenant a one-month relocation fee or waive rent for the final month of the tenancy.

Does the TPA preempt local just cause eviction ordinances? If a city or county adopted a just cause eviction
ordinance on or before September 1, 2019, that ordinance applies and not the TPA. If a local just cause eviction
ordinance was adopted or amended after September 1, 2019 it only applies if it is more protective of tenants than
the TPA.

NOTE: Quick Guide Tenant Protection Act of 2019-Part 1 (Statewide Rent Cap Law) provides information on the
Rent Cap portion of the TPA.

Source: California Association of REALTORS®. October 22, 2019.  Link

Tenant Protection Act of 2019-Part 1 of 2

Tenant Protection Act of 2019-Part 1 of 2
(Statewide Rent Cap Law)

What is the Tenant Protection Act (TPA)? Effective 1-1-20, the TPA establishes, throughout all of California, a
maximum amount an owner may increase a residential tenant’s rent in a 12-month period. The cap is 5% plus
inflation, not to exceed 10%. There are exemptions.

Exemptions from the Rent Cap rules
● Housing that has been issued a certificate of occupancy within the previous 15 years (new housing);
● A duplex in which the owner occupies one of the units at the commencement of and throughout the tenancy;
● A single-family residential property (including condominiums) so long as:

  1. The owner is not a corporation, not an LLC with at least one owner who is a corporation, and not a real
    estate investment trust (REIT) AND
  2. The owner gives the tenant a legally required notice of this exemption. Ownership by individuals,
    partnerships, individual co-owners, trusts, and LLCs with no corporate owners, all qualify for the exemption.

Giving notice of the Rent Cap exemptions:
C.A.R. form “Rent Cap and Just Cause Addendum” (RCJC) (available December 2019) may be used as follows:
For month to month tenants: For new tenancies starting on or after January 1, 2020, incorporate the RCJC
into the rental agreement. For existing tenancies, incorporate the RCJC by using a change in terms of
tenancy, such as C.A.R. “Notice of Change in Terms of Tenancy” (Form CTT).
For Fixed Term Leases: For new tenancies starting on or after January 1, 2020, incorporate the RCJC into
the new lease. For existing tenancies, simply provide the form as a stand-alone notice. If not already
provided, incorporate the RCJC into the lease upon any renewal or extension of existing leases.

Can rent be raised more than the maximum before the effective date?
Yes, however, the maximum Rent Cap raise is linked to the rent charged as of March 15, 2019. If rent was increased
more than the allowable amount (5% + inflation) before 1/1/2020 it must be rolled back to the allowable amount as
of 1/1/2020. Amounts collected before then do not have to be refunded to the tenant.

Does the TPA preempt local rent control ordinances?
Local Government Rent Caps: If a city or county limits rent increases to an amount less than that authorized by the
TPA, then the local ordinance applies. If a government entity is not as restrictive as the TPA, then the TPA applies.

Does the TPA limit the rent that an owner may charge a new tenant?
No. The initial rental rate charged a new tenant is not subject to the Rent Cap in the TPA. Subsequent increases to
the new tenant will be subject to the TPA.

Is it necessary for an owner to hire a lawyer before attempting to raise rent or evict a tenant?
The application of the TPA and its many exemptions and requirements, as well as the interplay between the TPA
and local ordinances can be complicated, and failure to abide by the law can have severe consequences. For that
reason, it is recommended that a property owner consult with a qualified real estate attorney familiar not just with
the TPA but also with local law.

NOTE: Quick Guide Tenant Protection Act of 2019-Part 2 (Just Cause Eviction Law) provides information on
the Just Cause Eviction portion of the TPA.

 

Source: California Association of REALTORS®. October 22, 2019.  Link

AB 1482, Tenant Protection Act of 2019 (Rent Control Act)

AB-1482 California Rent Control

 

As living costs soar across California amid a severe housing crunch, millions of residents will be protected for the first time from large rent increases and losing their homes if they have been reliable tenants.

California’s new rent cap and eviction protection law may have a limited effect on the Golden State’s surging apartment market following some uncertainty and disruption for investors, according to sales brokers and rental housing industry executives.

The legislation signed by Gov. Gavin Newsom is one of the nation’s strongest tenant protection laws, capping annual rent increases at 5% plus the inflation rate and restricting a landlord’s ability to evict a tenant.

California is the third state this year to adopt significant rent regulations, giving renewed national momentum to the push for rent control. Newsom predicted that more states would follow.

What types of buildings will be impacted?

Rent control will be applied mostly to apartments and other multi-families buildings—with some exceptions—along with some single-family homes.

Condos and single-family homes will be exempt unless owned by a corporation or real estate investment trust. Duplexes, where the owner lives in one of the units, will also be exempt.

How much will my rent go up?

If you live in a city that does not already have a local rent control law, rent increases will be limited to 5%, plus local inflation, but could never exceed a total of 10%.

For example, if you’re renting in Redondo Beach, which does not have its own local rent control law, and you pay $1,550 per month for rent, and Los Angeles County metropolitan area’s inflation rate is 3.8%, your landlord could raise your rent as much as 8.8%, a monthly increase of $136.40.

 

Link to Assembly Bill No. 1482

 

Source: California Legislative Information

All Millennials Should Understand These 4 Simple Truths About Home Ownership

 

  • A full 72 percent of millennials (defined as those aged 24 to 41) say owning a home is a top priority, according to Bank of America’s 2018 Homebuyer Insights Report.
  • Millennials as a whole continued to form the largest group of homebuyers of any generation at 37 percent of all buyers.
  • More millennials are pursuing homeownership now than ever before. The ownership rate among those under the age of 35 climbed from 35.6 percent in the third quarter of 2017 to 36.8 percent in the third quarter 2018, according to the bureau’s report.
  • Millennials enjoy the convenience of researching online, but when it comes to buying insurance, they want the confidence of talking with an agent.

Buying a home isn’t just about being sensible for Millennials— it’s a fundamental value. Understanding homeowners insurance and how to protect their home is a critical step in homeownership. Most home buyers don’t really understand what their policy covers.

  • Insurance isn’t a warranty
  • Your stuff is worth less than you think
  • “Full coverage” isn’t really a thing, Replacement Cost and Endorsements are
  • Filing a bunch of small claims can jack up your rates

Let Covered Insurance help your clients better understand homeowners insurance with this helpful blog: All Millennials Should Understand these 4 Simple Truths about Insurance. Pass it along.

 

LA County ADU facts.

ADU or Accessory Dwelling Units

Los Angeles County has updated its accessory dwelling unit regulations to comply with state laws that took effect on January 1, 2017. The ADU Ordinance was adopted on April 30, 2019 and took effect on May 30, 2019.

Need more living space for your family?

Need more living space for your family? Want to earn rental income? You can build an accessory dwelling unit on the residential or agriculturally zoned property that you own.

What is an ADU?

An ADU is a dwelling unit with a full kitchen and bathroom, which is an accessory use to a primary or main single family residence. The ADU can be used as a rental, but cannot be sold separately from the primary or main single family residence. The existing residence must be a legally established structure.

How to apply for an ADU 

An Accessory Dwelling Unit shall be permitted with a site plan. For more information please follow this link.

Please note that the County’s ordinance only applies in the unincorporated areas of Los Angeles County and zoning of the property is R-A, R-1, R-2, R-3, R-4, A-1 or A-2.

Mello-Roos

California Mello-Roos
Yearly Fiscal Status Reports
2016–2017

CALIFORNIA DEBT AND INVESTMENT ADVISORY COMMISSION
The California Debt and Investment Advisory Commission (CDIAC) provides information, education, and technical assistance on debt issuance and public funds investments to local public agencies and other public finance professionals. CDIAC was created to serve as the state’s clearinghouse for public debt issuance information and to assist state and local agencies with the monitoring, issuance,
and management of public debt. 

Click on the link for detailed information: https://www.treasurer.ca.gov/cdiac/reports/M-Roos/2017.pdf

 

Don’t become a victim! Who’s truly on your side?

Contrary to common belief, asking the listing agent to represent you as the buyer puts you at great risk.
Buyers are already in a vulnerable position when acquiring a property. It is the buyer agent’s fiduciary duty to protect his/her clients’ interests.
Buyer agents can negotiate a better deal than the listing agent who is obligated to protect the seller.

Legislation affecting dual agents.
Assembly Bills 1289 and 2884(2018), effective January 1, 2019, provide that a dual agent may not reveal to either
party facts relating to the financial position, motivations, bargaining position or other personal information that may
impact price, in addition to the restrictions already mentioned.

Read the full story: California Association of REALTORS®

Are You Making One of These Mistakes?

By: Lisa Kaplan Gordon

Before you rush into planting your dream yard, keep a few tips in mind.

You can just picture it: a pretty cottage garden overflowing your front yard, with tons of heavy, scented blooms.

Well, at least you can picture it with your eyes closed. With your eyes open all you see is a bit of patchy grass and a few scrubby shrubs. Yuck.

You need some color, stat.

That desire, though, is often what causes so many homeowners to waste money and time. Keep disappointment away by avoiding these seven mistakes:

#1 Planting Without a Plan

It's hard to envision your yard 10 — or even five years  — from now, but it's definitely worth the effort to try. It's way too easy to under- or over-estimate how everything will grow together.

In just a few short years you could have a mess that'll hurt, instead of add to, your home's value. 

“I’ve been with clients who won’t even go into a house because of the bad landscaping outside,” says Mack Strickland, a Chester, Va., REALTOR® and appraiser.

If the task seems too daunting, landscape architects are worth the investment ($300 to $2,500 depending on yard size). They will lay everything out for you. All you have to do is follow the plan. Kind of like paint-by-numbers. That's easy enough, right?

Related: How to Create a Landscaping Plan on a Budget

#2 Planting Too Close Together

Yes, planting in clusters looks way better than installing single plants, soldier-like, throughout your yard. But make sure your groups of perennials, shrubs, and trees have plenty of room to spread, or they’ll look choked and overgrown.

Also, over-crowded plants compete for food and water, putting the clusters at risk, especially during drought.

Google how high and wide the mature plant will be, and then combine that info with the spacing suggestions on planting labels.

They might look a bit sparse at first, but within three years, they'll be looking lush and healthy.

Old time gardeners have this saying: "First year it sleeps, second it creeps, third it leaps."

#3 Not Finding Our Your Hardiness Zone

Don’t be seduced by catalog plants that look gorgeous before you check your hardiness zone. If you don't know your zone, you can find it here, which will help you pick plants that thrive in your area.

Pick the wrong plant, and it could die prematurely (a waste of funds), need covering in winter, daily watering, or other tasks that'll consume your time, and just make you resentful in the end.

#4 Going Overboard With Your Favorite Plant

You love azaleas!! And what colorful blooms in spring! So why not plant a ton of them?

Because you could risk a yard that looks dull, dull, dull in all seasons but the one when your favorite plant blooms.

It's important to make room for four-season color.

For example, combine your gorgeous spring-blooming azaleas with summer-blooming roses and autumn-blazing shrubs, such as a burning bush (Euonymus alatus).

For winter color, try the red osier dogwood (Cornus stolonifera), a hardy shrub that sports bright-red branches in winter.

Related: 9 Winter Plants that Dazzle Even in Snow

#5 Letting Dead Plants Linger

Nothing wrecks curb appeal faster than rows of dead or dying shrubs and perennials.

Spent plants that lived their natural lives are good candidates for a compost pile -- if you grind them first, they’ll decompose faster. But if your landscaping succumbed to disease or infestation, it’s best to inter them in black plastic bags, then add to the trash.

#6 Weeds Gone Wild

Weeds not only wreck your landscaping's looks, they steal water and food from the plants you'd like to grow. Weeds also can shorten the life of brick, stone, and pavers by growing in mortar cracks.

The best way to stop weeds is to spread a pre-emergent about three weeks before weed seeds typically germinate. If you can’t stop them from growing, at least get rid of weeds before they flower and send a zillion weed seeds throughout your yard.

Related: Can You Spot These Common Weeds?

 

#7 Forgetting to Defend Against Hungry Intruders

Deer, rabbits, and other backyard pests think your landscaping is an all-you-can eat buffet, leaving you with denuded branches and topless perennials.

If you’ve got a critter problem:

Plant deer- or rabbit-resistant varieties. Your local extension agent can provide a list of green things critters won’t eat in your area.

Install an electric fence around landscaping you want to protect.

Spray plants with critter repellent. After a hard rain, spray again.

Related: Does Landscaping Give a Good Return on Investment?

 

 

Here are a few things you should know about California Real Estate!

Investing in California Real Estate

If you’re a home builder or rehabber who will finish your project soon, if you’re a speculator who will flip an acquisition, if you plan to split a property into several rental units or condos, if – in other words – you have an investment horizon of only a couple of years, now is a great time to invest in California Real Estate .

On the other hand, if you’re a builder with a multi-year project, if you plan to buy and hold rental property, if you’re investing with the intention of selling out after five years or so, be very wary of getting into LA or San Diego or the Bay area right now.

And if you already hold property and are looking for a good time to sell, you should start the process.

It’s not so much that home prices are in danger of falling anytime soon – at Local Market Monitor we’re forecasting that prices in all California markets will rise over the next three years – but that the risk of prices peaking and then falling will increase sharply every year. You never know what will trigger the end of a boom – or exactly when – and that’s what many California markets are in right now.

California Real Estate Stats in selected in cities:

The table of stats shows that much of the LA and Bay areas are already above the 15 percent threshold for over-pricing when you compare the current average home price with the ‘income’ price. Over-pricing gets serious above 30 percent and into the danger zone above 40 percent. With prices rising at 7 to 10 percent a year, that danger zone is only a couple of years away for Anaheim, Riverside-San Bernardino, and San Francisco.

It seems only yesterday that California home prices were falling and foreclosures rising, but the tech boom and the continuing attraction of California as a migration and immigration destination quickly ran up against the reality that very little home building has been accomplished in the state for more than a decade.

With average home prices sky-high in many markets – in San Francisco now more than $1 million –  investments in rental property will continue to be needed but this is where investors must be very careful not to overpay. Rents are far less volatile than home prices but if you plan a five year investment you could easily be looking at a very poor market when it comes time to sell. Don’t include expected appreciation in calculating the purchase price you’re willing to live with, and walk away if the asking price isn’t right; bad investments never look bad in the first couple of years.
Reference: Article publishes in March 2018 in Forbes in regards to Investing In California Real Estate, Author: Ingo Winzer is the President of Local Market Monitor, Inc., a North Carolina based residential real estate forecast company that provides MSA, county and zip code analysis nationwide to investors.

Based on the above report and our research about California Real Estate Market, we recommend the followings:

 

  1. If you are an investor, look for a short term (2-3 years) or a long term result. Buy within your affordability power to avoid selling when market in not hot.
  2.  If you hold a property in California and considering to sell, it’s a good time to act on it, and maximize your profit when selling during hot summer market.
  3. If you are downsizing or upgrading, it is a good time to start looking and take advantage of the low mortgage rates. Since you are selling and buying right away, the market fluctuation will not effect you.
  4. If you are a first time home buyer, make sure to consult with a knowledgeable expert so you will buy your first property in the right neighborhood with the right price and avoid over paying.
  5. There are many cities in California that are still undervalue and have not reached their optimum pricing. Please contact us for more information.

link to the full report: https://www.forbes.com/sites/ingowinzer/2018/03/01/investing-in-california-real-estate-here-are-a-few-things-you-should-know/2/#6223f7651132