Now more than ever, we are getting a high volume of incoming calls from clients who are deciding to sell. With quite a bit of uncertainty, we are seeing some clients choose to sell for reasons such as AB 3088, eviction moratorium, rent control measures, political uncertainty and more. Each one of these topics deserves its own post so I am going to discuss each of these in a separate blog and how it affects the value of a building/landlord. This week, I will discuss AB 3088 and how it affects you.

• The bill was passed by Gavin Newsom on August 31, 2020 and was decreed immediately. From this effective date the eviction moratorium was extended through January 31, 2021 which includes “Just Cause” evictions. The bill excludes Single Family Homes and Condos in which a new buyer plans to owner-occupy, or tenancy that was terminated prior to March 1, 2020.
• From September 2020 through the end of January 2021 tenants are permitted to pay 25% of rent either monthly or all at once in order to avoid eviction. Tenants must provide a declaration of COVID-19 financial distress to the landlord to qualify.
• After January 31, 2020 a landlord can serve a 15-day notice to evict for non-payment of rent. If provided with COVID-19 distress forms the landlord cannot evict from March-August for any non-payment nor from September-January if tenant paid 25% of their rent.
• The state has expanded the small claims jurisdiction for COVID 19 debts -- this applies to rent not paid from March 2020-August 2020. The landlord will not be allowed to evict for the unpaid rent and will have to take the tenant to court for any claims of unpaid rent.
• The bill enacted “guardrails” on local eviction moratoria including any expansion or renewal of a moratorium after February 1, 2021 – in other words this supersedes any new local claim to elongate a new moratorium. Additionally, local governments cannot create new mandates with respect to payments that came due between March 2020 and January 2021.
• It enacted new penalties for illegal lock-outs which include actual damages plus an additional $1,000-$2,500 if the tenant provided a declaration of COVID-19 financial distress.

All of these rules, coupled with landlords being fed up with the current situation, are causing some of our clients to consider selling. Most landlords accept the fact that these are trying times and tenants will have a difficult time paying rent. But it is scary for landlords to not have the eviction tool at their disposal.

Message us through our website if you have questions about AB 3088 and to discuss your options.