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NEWS

Buyouts of Tenants Are Regulated

The San Francisco Supervisors in a 7/4 vote (Breed, Farrell, Tang, Wiener opposing) approved groundbreaking legislation from Supervisor David Campos which will stop the speculators from using buyouts to get around prohibitions on condo conversions and other tenant protections. Mayor Lee declined to veto the legislation.
•Requires buyouts to be filed and registered with the San Francisco Rent Board.
•Imposes the same condo conversion prohibitions as for no-fault evictions when a tenant has vacated under a buyout agreement after October 31, 2014.
•Requires landlords to notify tenants of their rights (in a form developed by the Rent Board) prior to negotiating a buyout.
•Gives tenants the right to rescind a buyout for 45 days after signing the agreement.

Airbnb Legislation Summary

•The legislation does not change a rental agreement’s restrictions on subletting. (However, subletting is allowed under a different section of the San Francisco Rent Ordinance despite a prohibition in the rental agreement.)
•The legislation becomes operative February 1, 2015.
•The tenant may not sublet for more than the rent paid to the landlord each month.
•The tenant is given a chance to cure (fix) the first violation of Chapter 41A of the San Francisco Administrative Code (residential rentals for less than 30 days) after a written notice.
•The tenant must register with the San Francisco Planning Department which will maintain a database of which tenants qualify for renting to others for short-term residential use.
•The tenant must occupy the rental unit for at least 275 days of the calendar year or if the tenant has not rented for a full preceding calendar year, for at least 75 percent of the days sh/e has occupied the unit. Only one tenant in each residential unit qualifies.

Ellis Act Eviction Payment Ruling Will Be Appealed

Ellis Act evictions, starting June 2, 2014, required the landlord to pay the displaced tenants the difference in rent for two years as calculated by the San Francisco Rent Board. This law has been overruled in Levin v. City and County of San Francisco. The landlords claimed that the payment of 4.7% of the estimated profit to the tenant was an unconstitutional "taking" of the property by the city. Defense arguments were raised by the San Francisco City Attorney which will appeal the ruling. Judge Breyer indicated during oral argument that landlords who have already paid the Campos relocation are free to pursue the City for reimbursement.

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