I live in a unicorn of an amazing SF apartment. We pay well below market rate for Pacific Heights for a flat that is part of a two-unit building built in 1913. I have lived in it for three years with two roommates all in our 30s. I am the master tenant on the lease.
After an insane six months of a struggle over the estate of our former landlord who owned our flat and lived upstairs in the penthouse unit, (Two wills! Mentally unstable identical twins! A case of mistaken identity in which my roommate’s clothing got stolen as retaliation for the ensuing settlement on the estate!) it has finally gone on the market.
The building is going to be purchased faster than someone could tweet the Redfin listing, so I want to know what my rights as an existing month to month tenant are. I know I will probably be kicked out for our new owner to charge twice what we pay for the place but I want to know what, if anything, I can do to make the inevitable eviction work in my favor. After having to deal with the last half year of insanity, I would like to know that there is some sort of silver lining on this incredibly dark cloud that is the SF rental market. Please don’t tell me to move to Oakland.
Like the unicorn, rent controlled apartments are mythical and fast becoming extinct, especially when they become objects of desire for Twitter-motherfuckers and bubble-headed investors. Yours is a typical San Francisco fable wrought with insatiable greed, two-headed, cross-dressing monsters and an age-old struggle to save the unicorn from the forces of evil–a tragic ballad.
While you should prepare for your eventual departure, your rights are completely intact until a new owner decides upon his course of action for the building. Remember that you must be evicted for one of the sixteen just causes stated in the San Francisco Rent Ordinance. For example, a new landlord cannot kick you out to charge twice the rent to another tenant. If that happens, you’ll have a unicorn of a wrongful eviction lawsuit!
Intuitively, it seems like a new owner who truly wants to live in the building would move into the penthouse and continue to rent to you. I’ve seen that once or twice in my career.
Here’s a more typical scenario for a two-unit building like yours. The owner threatens to serve a sixty-day owner move-in notice, hoping to begin a buyout negotiation. At that point you may be able to negotiate a buyout of your tenancy that involves waiving all of your Rent Ordinance rights. I’ve written several articles about tenant buyouts and won’t go into all the nuances here.
The upside for the new owner is that can move upstairs and charge the new tenants twice your rent for the downstairs unit.
The theoretical upside for you is that you and your roommates will receive more than the $15,621.00 statutory relocation payment mandated by Rent Ordinance §37.9C.
If you’re thinking about negotiating a buyout you should also understand if you or one of your roommates is disabled within the meaning of California Government Code §12955.3 because you may be eligible to receive $3,472.00 for each disabled tenant who has lived in the unit for more than a year.
If you or your roommates are eligible for the additional relocation payment, your are also disabled within the meaning of the Americans With Disabilities Act (42 USC 12102.) This is important because an owner who evicts you, even with a just cause, will be barred from converting the building to condominiums per San Francisco Subdivision Code §1396.2. This is a valuable negotiation tool.
A developer/landlord may threaten to evict you using the Ellis Act, a process by which the owner “goes out of the landlord business” and sells the units to TIC buyers. The Ellis Act should be repealed.
You can evaluate a buyout using the same factors described above. Ellis relocation payments are slightly higher. Ellis evictions require a 120-day notice or, if you or one of your roommates is disabled, you could be entitled to a one-year extension of the notice.
Like Ted Gullicksen at the Tenants Union says, negotiating a buyout is a “game of chicken.” You don’t know what the landlord really wants to do and you don’t want to commit to a buyout unless it works for you, but there may be an instant when one of the parties drives off the cliff, caves, or the landlord simply serves a eviction notice.
If you receive a notice out of the blue, remember that the requirements for an OMI notice and an Elis notice are strict. Go to the San Francisco Tenants Union and become a member to get help to evaluate the legality of the notice.
Finally, I almost never recommend that a tenant defend an unlawful detainer (eviction action) based upon an OMI or Ellis notice. There are no defenses to an Ellis eviction. Unless you can prove that the landlord lives in a castle in Monaco and that he could never intend to live in your flat, as his primary residence for three years, you probably shouldn’t risk going to court to defend an OMI eviction either. For tenants, the court is the place where bad things happen.
What’s wrong with Oakland? I lived in Oakland for years. The weather is better. Just think of yourself as one of thousands of San Franciscans who are putting the there back there.