My Landlord Is Selling My Building, How Pessimistic Should I Be?

by | Jan 10, 2013 | Illegal Unit

I’ve lived for three years in the in-law apartment of a residential, two-family home built in 1900 (the landlords live in the main house upstairs; I live in the in-law/garden apt on the first floor). It’s in  Bernal Heights.

My landlords, with whom I have a very good relationship, are approaching their 80s, and just informed me last week (via a handwritten note on a piece of cardboard) that they are putting the house on the market.

I am 35, I have a dog (who I just adopted two months ago), and my rent is $1300, and hasn’t gone up since I moved there. As I understand it, any new owner would just slip in and become my new landlord…unless they do an Owner Move-In, in which case they would have to give me a bunch of money and 60 days to vacate and physically have a family member move in. Is that about right?

I’m a born pessimist, and I realize this is subjective, but does it happen often that a tenant in a situation like mine is forced out? Is it at least possible that a potential new owner would want the already-installed tenant and their monthly check? I’m trying not to freak out, but I just know that finding a similar place in SF (I love both my apt and Bernal very much) is basically impossible at this point, as would be buying a home. I don’t want to have to leave.

You claim to be a born pessimist. Perhaps you’re not being pessimistic enough. People who buy houses with in-law units rarely want an “already-installed tenant and their monthly check.” Why? Because your monthly rent will barely cover the new property taxes based upon the insane price a new owner paid for the house.

In other words, even if a new owner wants to rent his in-law unit, he doesn’t want to rent it to you. You’re not paying enough rent. San Francisco rents increased from 15% to 25% citywide last year according to an October article in the SF Examiner.

“It’s been an exciting, epic year for the rental market in San Francisco,” said Laura Gray, who handles rentals for Paragon Real Estate.

She attributes the increase in younger single tenants to the the aggressive hiring of tech firms such as Google, Apple and Twitter.

With demand for smaller rentals so high, many younger tenants are choosing to double or triple up in a larger three-bedroom flat. With singles prepared to pay anywhere from $1500 to 1800 per month for a shared rental, larger flats in San Francisco are easily renting out for $5000 to 6000 per month.

Hey, it’s been an exciting and epic year and San Francisco taxpayers (you) have subsidized Twitter-Motherfuckers so that their employees can pay $1,800.00 per month for a room in a three-bedroom flat. That same flat rented for about $1,800.00 total a couple of years ago. Based on my many conversations with tenants looking for apartments, the trend continues.

The first question you must ask: “Is my unit illegal?” In my experience most in-law units, like the one you describe, are illegal. I have written much on this subject over the years. I outlined the factors to make that determination in “SF Appeal Tenant Troubles: Can I Be Evicted Just Because My Apartment’s An Illegal Unit?”

You need to understand this because the present owners or a new owner can “remove the unit from the rental market” because it is illegal pursuant to Rent Ordinance section 37.9(a)(10).

All an owner has to do is inform you of his intent to demolish and get an over-the-counter building permit to remove the unit. Then the owner can serve you a 60-Day Notice to vacate with the permit attached and pay you the requisite relocation payment to move. The relocation payment this year beginning in March 2013 is $5,153.00. I don’t know about you, but I don’t consider that a bunch of money when it will likely cover about three or four months of your new Twitter-based rent.

To add insult to injury, I’ve seen many instances when a landlord will reinstall a kitchen in an illegal unit and re-rent it. There is absolutely no penalty for this unless the new tenant finds out and reports the unit to DBI and sues for fraud.

Epic. Happy fucking New Year! How’s that for pessimism?

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  1. We owned a single family home in San Francisco And there is in law that we built recently with permit ,but we added a kitchen was not permitted . There are 3 rooms which we’re built with permit ,we are thinking of renting as 3 room apartment , but the kitchen was not built with permit ,what will bethe cosiquesnces if the city find out .if we had rented it how do we deal with renters.

  2. What I don’t understand is why SF renters are so entitled. If I buy a 3 unit building in mostly any other city in the world, I can do whatever I please with it. But in SF, tenants feel like they should just be able to stay where they are FOREVER rent controlled? Doesn’t make much sense to me. I am a renter, from another state. I live in SF now and I would never have dreamed of thinking that I am entitled to stay in someone’s house that they own when they purchase it from someone else “just because.” It’s pretty rediculous in my eyes. Someone owns a building = it’s THEIRS! They shouldn’t have to pay you 60k to settle and get out of THEIR house!!

  3. Arguably, if his unit was legal he shouldn’t be subject to any eviction at all as long as he pays his rent. I don’t believe this has been decided in the courts, but I don’t think that an LMI eviction can be performed on an illegal unit because the unit is, per se, uninhabitable.

  4. How would this gentleman’s case be different if the unit were legal and selling? Can there be and LMI eviction of the in-law unit?

  5. My husband and I, who also rent an illegal in-law, are facing a similar situation. To give you some idea of how callous some potential buyers can be, during one recent visit by prospective buyers to our unit, audible comments were made regarding remodeling that could be done – a clear indication the buyers had no intention of keeping us on as renters.

    When I responded by observing how if they went ahead with their plans, they’d be displacing a couple of middle-aged renters from their home, the person casually responded in an exaggerated tone, “No, not you!”

    It was a very dehumanizing experience, although not completely surprising. I’d hoped to remind them we were two human beings and not merely two disposable objects, something people sometimes forget when money is involved.

    If and when we get evicted, we’re considering a move out of the City, since we can no longer afford the exorbitant rents charged in my once beloved, native home.

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