LA blazes cause rents to soar
Los Angeles’ devastating wildfires have destroyed at least 10,000 homes and displaced at least 150,000 residents, leaving many struggling to find affordable shelter.
Some are staying with friends and family, while others are finding refuge at hotels and Airbnbs. New wildfires broke out last week in Southern California, including the Hughes fire north of Los Angeles, which has burned 10,000 acres.
Some landlords have capitalized on residents’ desperation by hiking rents to exorbitant levels, despite laws that set limits on such increases.
Between Jan. 7 and 18, landlords and agents tried to illegally overcharge Los Angeles County renters by a cumulative total of $7.7 million a month, according to a study based on Zillow data by the Rent Brigade, a collective that includes tenant organizers and advocates.
The number of rent-gouging instances jumped by more than 5,000% from the first day of this time period to the last, according to the study.
A crowdsourced Google spreadsheet of rental listings also shows that the prices of some single-family residences jumped by thousands of dollars. For example, one unit rose from $2,690 a month in late December to more than $5,100, according to the spreadsheet, which was created by Chelsea Kirk, director of research and policy at Strategic Actions for a Just Economy.
“The spreadsheet is functioning as a proactive and effective form of enforcement,” Kirk said.
During a state of emergency, landlords can’t increase the price of rentals by more than 10% of the previous price, according to California’s anti-gouging law. Nor can they charge more than 160% of a rental’s fair market value if it hasn’t been previously rented. The law is in effect for 30 days after an emergency declaration, a declaration that officials made Jan. 7. Violators can face a fine of $10,000 and/or up to a year in county jail.
A Zillow spokesperson said the company is aware of price gouging happening in Southern California, and it’s removed listings from its site that exceed the emergency threshold.
“We believe it is essential for housing providers to follow local housing rules, including consumer protections against price gouging during and following a natural disaster, and we are providing resources to help them understand their responsibilities,” the spokesperson told Marketplace.
If you believe you are a victim of price gouging, you should report it to local authorities or the California attorney general, according to a press release from Attorney General Rob Bonta’s office.
But some are concerned that the state won’t enforce the law. “Landlords, historically, face no consequence,” Kirk said.
Joseph Tobener, a tenants’ rights attorney and founding partner of Tobener Ravenscroft, said public agencies “don’t have the bandwidth to pursue all the bad actors.”
And private attorneys can’t get attorney fees and enhanced damages in price-gouging cases, even though they normally can when it comes to other tenants’ rights cases, Tobener said.
“The cases aren’t attractive for private tenant rights’ firms to take on,” Tobener said.
Grant Riley, an attorney at the firm Riley Ersoff, said he’s been receiving calls from long-term tenants around LA County who have been paying their rent on time but received notices to vacate. Creating a new vacancy, especially during a housing shortage, could be a way for a landlord to jack up the unit’s rent to inflated market value after the wildfires, Riley said.
“Landlords are looking for excuses to hold tenants in default so they can evict,” Riley said.
These wildfires could put “a large upward price pressure on rents in the next year or so,” said Edward Kung, an associate professor of economics at California State University, Northridge.
“The scale of the disaster is really, really enormous, even relative to the amount of housing that the city typically builds in a given year,” Kung said.
Riley is concerned that one person’s decision to rent out an overpriced apartment or house could create a ripple effect across the region, pushing up prices and pushing out lower-income tenants.
Because the attorney general may not have the capacity to take on every case, there are other ways tenants can respond.
If you believe you’ve been overcharged on rent, you can file a claim in small claims court and sue for up to $12,500 in damages, according to a Tobener Ravenscroft guide on fighting rent gouging.
For those trying to navigate the region’s rental market, Riley suggested finding a place far from the most in-demand areas, where there’s less upward pressure on rents. “If you live in South Pasadena, but you can move to Riverside County, even temporarily, try to do that,” Riley said.
If you think your landlord is exploiting the disaster to overcharge you, remind him or her of the state’s anti-gouging law, Riley added.
And if you live in LA and think a landlord is trying to unfairly evict you, contact a private lawyer or a nonprofit organization that helps tenants, like the Inner City Law Center, Strategic Actions for a Just Economy or the Housing Rights Center, Riley said.
“Unfortunately, most tenants don’t know their rights and get bowled over by greedy, unscrupulous landlords,” Riley said.