Sorry we're not sorry, TIC owners -- the law applies to you, too
EDITORS NOTES People who rent apartments aren't second-class citizens. In fact, under San Francisco laws, they have (and ought to have) many of the same rights as the landed gentry.
If you rent a place in this city, and you pay the rent on time, and abide by the terms of the lease, you should be able to stay in your home (and yes, it IS your home) as long as you want. The rent can only go up by a modest amount every year.
Landlords know that when they enter into rental agreements. Accepting a tenant means acknowledging that the person may want to say in his or her apartment for years, maybe for life; the rent the landlord sets for that unit has to be adequate to cover a share of the mortgage, expected maintenance costs, and a reasonable return on the owner's investment.
When you buy a piece of rental property in the city, you are told that tenants live there; you're told what rent they pay, you're informed that you can't raise it much, and unless your utterly ignorant of local law, you realize that the tenants have, in effect, lifetime leases since you can only evict them for "just cause" — which does not include your desire to make more money.
If the numbers don't pencil out under those conditions, they you shouldn't buy the place.
That's how a sane rental housing system ought to operate. Unfortunately, the state Legislature has undermined local rent-control laws with the Ellis Act, which allows landlords to evict all their tenants, cease renting altogether, and turn the place into condominiums. Or, since there are limits on condo conversions in this city, into tenancies in common, which are not limited at all.
Sup. Scott Wiener wants to make it easier to turn TICs into condos; he says the poor TIC owners are having a tough time and can get better mortgage rates if they rules are changed. I don't feel bad for them; they knew the rules when they bought their TICs. They have no right to convert to condos; that's a privilege granted to a limited number each year, by waiting list and lottery. Buy a TIC? You should assume it will remain your ownership model for a long, long time.
The city can't stop the TIC conversions, but it can set ground rules — for example, local law mandates a payment to tenants who are evicted, which can reach $5,000. Sounds big — but it won't even pay two months' rent on a new place in this market.
SO let's be fair here: If you want to evict a tenant, who has and ought to have the right to a stable place to live, you should pay enough to make that person whole. Calculate market rent on a similar place; subtract the current rent the tenant is paying, and cover the difference — for, let's say, five years.
If that makes TICs too expensive, and thus lowers property values by making evictions difficult and keeping rents low, fine: Property values are too high in this town anyway. And if it means more stability for lower-income people at the expense of property owners ... well, I can live with that.
Most Commented On
- WSTIplStATvoUMI - April 18, 2014
- tifhALBCiBgXohWZjVNj - April 18, 2014
- QcWUdNcXLTWG - April 18, 2014
- FLkyXhOlYKUEYFqR - April 18, 2014
- MaTyjnUVgg - April 18, 2014
- OcyjxZQpLjtVfDgtVQa - April 18, 2014
- ZHXpfhPVpo - April 18, 2014
- NwANHRyAHtphIaBTNZKi - April 18, 2014
- Wrong, Steven, the "Guest" made no cogent arguments. - April 18, 2014
- I like the band - April 18, 2014