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Ellis Act Evictions: Critical Ways California Eviction Laws Could Change

Ellis Act Evictions Under Scrutiny

A bill targeting Ellis Act evictions has died — for now. AB-854 is known as “The Stay in Business Forever Act.” It would require landlords to own a property for five years before removing units from the rental market. The Ellis Act is one of the few ways California landlords can evict tenants without fault. Along with the Statewide Rent Registry (AB-1188), AB-854 is part of a growing trend in Sacramento toward sweeping changes to landlord-tenant law. 

As San Francisco landlord-tenant attorneys, we field many questions about Ellis Act evictions, so let’s look at AB-854, and what it would mean to California landlords and tenants.

San Francisco Ellis Act Evictions

All evictions in San Francisco require just cause. For decades, The Ellis Act has allowed landlords to evict tenants without fault. That means there is no wrongdoing of the tenant. It gives landlords just cause to exit the rental business. As rents and property values rise, so have Ellis evictions. This is especially common in cities like San Francisco with high rents and strict rent control laws. 

Rules for Ellis Act Evictions Vary By City

In order to be approved under the Ellis Act, landlords must evict all tenants. They must also file a notice of intent to withdraw the property from the rental market. In San Francisco, a landlord must pay a relocation fee for each tenant. In addition, they must provide certain provisions for the disabled or elderly, along with other specific requirements.

Ellis Act rules vary by city. For this reason, it’s important to stay informed on changes to both state and local laws. 

How Changing Eviction Laws Would Impact California Landlords and Tenants

Ellis evictions can be costly and time consuming. Under the law, there are specific rights and rules for both landlords and tenants. Improper filing could cause legal consequences. This includes paying tenant damages, and possibly, criminal liability. If passed, AB-854 would place more restrictions on Ellis Act evictions.

AB-854 would require a landlord to own a property for five consecutive years before evicting under the Ellis Act. Plus, it would limit the landlord to use The Ellis Act to one property every ten years.

Proponents say the measure prevents the loss of affordable units. When owners convert buildings into condominiums, or replace them with new housing projects, rental units leave the market. Opponents say owners should have the freedom to change the use of their property. They may want to move into it themselves, sell off individual units, or sell the entire property. Also, the Ellis Act provides a safety net for owners who may be losing money on a rental unit.

Limiting the Ellis Act May Do More Harm Than Good

Restricting the Ellis Act may harm good landlords instead of stopping the bad ones. Since there are already backstops in place to protect tenants, adding more laws is not the answer. Although shelved, AB-854 will most likely resurface with further attacks on the Ellis Act in 2022.

You can read the complete text of AB-854 here.

Whether you are a landlord or a tenant, it may be in your best interest to contact an attorney if you’re involved in an Ellis Act eviction. As San Francisco’s foremost landlord-tenant attorneys, Steven Adair MacDonald & Partners can clarify how the Ellis Act affects you from a landlord or tenant perspective. We can suggest the best strategies for your particular situation. To schedule a consultation with one of our attorneys, please call 415-956-6488.

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