Los Angeles to Force Landlords to Pay Tenants' Relocation Costs

Los Angeles—which still has a policy preventing landlords from evicting tenants who claim COVID-19 hardships—is planning to replace the eviction moratorium when it ends at the end of this month with a new extended set of tenant protections.

According to a report in the Pasadena Star-News, the City Council is about to adopt a set of universal “just-cause” protections including providing relocation assistance to tenants who are facing steep rent hikes and prohibiting evictions of tenants who owe less than a certain amount of rent.

Tenants in rent-stabilized units or units covered under a separate state law already have just-cause protection. The new law, expected to be approved by the council this month, expands just-cause protections to tenants in 396,000 units in Los Angeles.

An exception was carved out for short-term leases, with an amendment to the proposal setting the just-cause protection to kick in at the end of a tenant’s first lease or after 12 months, whichever comes first, the Star-News reported.

Under the new law, landlords will be required to pay relocation assistance to renters who decide not to renew their lease because their rent is going up more than 10% or by more than the Consumer Price Index plus 5%. The relocation assistance is pegged to three times the fair market rent plus $1,411 in moving costs.

According to the Los Angeles Housing Department, fair market rent for a one-bedroom apartment in Los Angeles is $1,747; the fair market rate for a two-bedroom is $2,222.

Regarding evictions for tenants who are behind on rent payments, the new law allows tenants who are past due to stay in their apartments for a month, unless they owe more than one month’s worth of fair market rent.

The eviction moratorium established during the pandemic in Los Angeles ends on January 31 with the expiration of the city’s COVID-19 local state of emergency. Tenant rights advocates have been pushing the City Council to enact a replacement for the moratorium before it expires.

Multifamily rents declined in the fourth quarter for the first time in two and a half years in greater Los Angeles, despite an occupancy rate that held steady at more than 96% since the beginning of 2022, according to Colliers’ Q4 market report.

In a sign of a developing downturn, new supply (measured in units delivered) outpaced demand (measured in units absorbed), for the second consecutive quarter in LA, GlobeSt. reported.

Colliers reported that 3,573 new apartment units were delivered in the market in Q4, while 1,980 units were absorbed; supply also outpaced demand in Q3, with 2,470 units absorbed out of 2,639 delivered. By comparison, demand in Q4 2021 outraced new supply, 5,018 to 3,584.