Advocate

For three long years, rental property owners have suffered through the challenges of the eviction moratoriums and struggled to keep investment properties and their businesses open. The eviction moratoriums created large sums of back rent owed to owners often in the tens of thousands of dollars. The hardships have led to some owners’ properties going into foreclosure and others getting into substantial debt. Good news, though, relief is in sight.

The following cities and counties have either already lifted the moratorium or will be doing so soon. Here are some key end dates:

Alameda County

April 29, 2023

OAKLAND

July 15, 2023

BERKELEY

August 31, 2023

SAN LEANDRO

July 31, 2024

Property owners are advised to follow the right procedures to collect back rent. It’s absolutely critical that property owners tread carefully in order to avoid legal problems that will only create more hardships. The winddown of the moratorium will be untidy as we reconcile state, county and local laws. We have been inundated with state and local moratorium laws such as the Berkeley/Oakland moratorium. And as a result, this patchwork has become complex to maneuver.

Specific steps and legal measures must be taken to deal with the context of the moratoriums ending. Each city or county will have different rules and regulations. These are options for most rental markets:

3-DAY NOTICE

1. Renter pays rents and cures the violation of the rental agreement

2. Renter does not pay rent and cure the violation

3. Go through the legal remedies

30/60/90-DAY NOTICE

1. Renter does not move out

2. Renter pays rent and cures problem

*The obstacles and greatest challenges are renter attorneys who will work hard to prove their case against you. Most property owners will likely go through the 90- to 120-day process. However, it may take up to 6 months, as the courts are likely to be inundated with cases. Expect delays in this timing as the courts become deluged and there aren’t enough court personnel and courtrooms to fill demand.

Returning To Normal

There is an expectation that we will return to how owner/renter relationships were managed before the pandemic. Housing provider/renter relationships in a pre-pandemic world will not be the same in this new era. The ending of the moratorium doesn’t mean there won’t be some residue regarding moratorium rules – it just means the moratorium on evictions is ending. In cities that don’t extend the moratorium, properties owners have a clearer path to collect rent going forward.

Do not believe when there’s tens of thousands of dollars in back rent that property owners are going to be able to collect it three days after the moratorium lifts. DO NOT demand back rent that was owed during the moratorium with a three-day notice. Rent debt going forward is something that can be reasonably demanded with a threeday notice, and rent debt in the past must be treated differently. There are a number of variables, different covered periods, and it depends upon cities as well. More restrictive environments are Berkeley, Oakland and San Leandro. In these jurisdictions, property owners should seek legal counsel to determine the best options for their specific scenario.

For rent debt owed in Alameda County (except Berkeley, Oakland and San Leandro), do not serve a three-day notice for back rent. The moratorium and the rules relating to that debt are complicated and cumbersome. Contact an attorney to discuss your options. It will depend upon where the tenancy is located. It will also depend upon when that debt arose. Unfortunately, the easy, simple solution of serving the renter a three-day notice to pay for that debt is not viable and can get property owners into trouble.

It’s likely the debt will be treated like consumer debt. Therefore, property owners cannot act on collections like a normal eviction. You'll need to get a money judgment and that can be a daunting task. Many property owners misunderstood that once moratoriums end, they could immediately serve three-day notices for that past due debt.

Another concerning issue – we don’t know if there are going to be government funds to make property owner issues whole. Housing providers are reasonably pessimistic, for good reason, that there isn’t going to be much more funding available to make their businesses whole.

While some people have received emergency relief funds and are still securing funds in jurisdictions such as San Francisco City and County, in other places it’s more difficult to locate and source those funds. In the East Bay, it has been enormously difficult and complicated.

Avoid Mistakes

With the newfound ability to demand rent, don’t make these mistakes:

• Demanding more rent than is legally due

• Failure to correct any habitability issues

• Improper service of the notice

• Using bad, stale or templated notices

• Depositing a future rent payment after the unlawful detainer action has commenced

• Other issues – consult an attorney

Rent debt owed prior to the end of the moratorium cannot be used as a basis for eviction. Be aware that renters can still get free legal representation from qualified renter attorneys. These attorneys will not acknowledge their renter is in the wrong, even if they haven’t paid rent after the moratorium has ended. Furthermore, if renters owe property owners a substantial amount of unpaid rent, attorneys are going to fight to keep that renter in possession of the premises. Thus, attorneys are going to look for mistakes property owners have made in the demanding of the rent.

So, protect yourself and get your documentation in order. Document correspondence and take inventory of renter ledgers in order.

After moratoriums lift, property owners can demand rent and begin the process of an owner move-in eviction with proper notice under some circumstances. Proceed carefully and you will mitigate risks as you move forward.

This article is based on a presentation given by Daniel Bornstein, ESQ

Important Facts About Oakland

Late fees – cannot be imposed until after July 14, 2023

Rent restrictions: if the housing is rent-controlled, the housing provider can raise the rent, but it’s subject to added restrictions through June 24, 2024.

Property owners will have two options for court resolutions, which are:

1. Small claims court – no attorney representation and under a certain amount (usually under $10,000)

2. Superior court – attorney representation and more expensive but more due process