How much relocation compensation is proper?

Question

Phase 1 (Sending Notice): I have one condo in Palo Alto for renting. This January, I plan to sell the condo and gave my tenant 90-day notice to terminate the month-to-month lease. He acknowledged my notice. Later he asked a 15-days extension and I approved.

Phase 2 (Tenant move out): On May 10, 2025, we did final walkthrough and returned my tenant security deposit and my tenant moved out. After that, he keeps quiet until his last property (car) has moved out the garage on June 13, 2025.

Phase 3 (Tenant claim relocation compensation): After his last property moved out, on June 14,2025, he claimed that I should compensate him $28500 for all the costs of moving, storage, disruption of his life. Last weekend, he reduced the amount to $18800, otherwise he may goto court. I am a bit surprised that if he is expecting such high compensation and suggests him to inform me around the time when 90-day termination notification is received so that I have a chance to consider whether to keep the property.

This month, he mentioned he is 90 years old which I don't learn of that as I don't ask him anything about age before and treat him as a regular tenant. During the last three years renting, we have a good relationship. Several times, maybe 5-7 times, on the last day of grace period, he always asks for extension of grace period and I approved.

In my opinion, I made the following mistakes:

Phase 1: I didn't mention the relocation compensation in the termination notice as I didn't realize that this is needed

Phase 2: I should write an note that all the financial payment and due between us are cleared when he move out.

I am glad to compensate him for the relocation cost. However, I am feeling that it costs me too much for the two mistakes I made above.

Question:

• 1. Should I reject his ask for $18800 and go to a court?
• 2. What's the estimated lawyer cost if going to court?
• 3. What's the correct way to terminate a month-to-month lease in Palo Alto (no rent control) if I plan to sell the property. When you terminate month-to-month lease in CA and follow the regulation, normally how much compensation you will give your tenant?
•

Regards, Zhenyang

Alan F. · Answer

Type Palo Alto no fault eviction relocation assistance into Google

Gemini will give you the quick condensed synapses.

Scroll down & read the exerts from the lawyer firms

Read city of PA website.

Particular attention the annual increases since 2018 & the senior addendum.

As a landlord you should already know this, you may want to seek legal counsel

Disclaimer; this is advice i found from the internet and no way implies any legal or professional advice

Denise Supplee · Answer

Hi @Zhenyang Jin nice to meet you here on BP. In your situation, the first thing to clarify is whether Palo Alto’s local ordinances or any applicable California state laws actually require relocation assistance in your specific case. Since you mentioned there’s no rent control, state law (AB 1482) might still apply if your property isn’t exempt, and that law sets relocation assistance at one month’s rent, not tens of thousands of dollars. If your condo is exempt, such as certain single-family homes, you may have had no legal obligation to provide any relocation payment at all. That’s why before responding to his demand, it’s worth confirming with a local landlord-tenant attorney whether you were legally required to pay relocation assistance, and if so, how much.

His claim for $18,800 sounds like it’s based more on personal disruption than on any statutory requirement, and courts typically look to what the law requires rather than subjective hardship claims. A judge will want to see documentation of any obligation you had, and if none exists, his case is weak. Given the amount he’s requesting, hiring an attorney for even one or two hours of consultation could be very worthwhile, as they can send a firm legal response that may stop him from pursuing it further. If it did go to court, legal costs could vary widely depending on whether it’s small claims (which in California caps awards at $12,500 and doesn’t allow lawyers in the hearing) or a higher court, where attorney fees could easily run several thousand dollars.

For future terminations, it’s important to follow California’s notice rules to the letter and check both state and local ordinances for any required relocation payments. If you provide a written notice that cites the correct legal basis for termination, and you close out the tenancy with a signed “mutual release” stating that all financial matters are settled, you can protect yourself from post-move-out claims like this one. In your current case, you may find that the law is firmly on your side, and it’s better to politely but firmly decline his demand after getting legal confirmation.

JD Martin · Answer

I have no idea what California law says about this but unless the law required me to pay for him to be moved I would give him nothing. Frankly it's a lot of gall for a month to month tenant to expect the owner to pay for him to be moved.

Wilson Lau · Answer

@Zhenyang Jin Here is the Palo Alto's ordinance regarding just cause eviction: https://codelibrary.amlegal.com/codes/paloalto/latest/paloal...

The relocation assistance rights notice should be included with the 90-day notice, and you can find out the compensation amount under the ordinance (based on the size of your building, even though you only own 1 unit within the building).

About Attorney cost, real estate attorney charge by hours. Normally $300-$500/hour.

Ying Tang · Answer

Hmmmm...I would think that because you have month-to-month lease, either one of you can terminate the lease, as long as sufficient period of notice is given (per the original lease). If its annual lease, that's a different story. People threat to sue people all the time. Anybody can sue anybody, but 99% of the time the threat will be empty.

Zhenyang Jin · Answer

Hi Denise, Thank you for the great help.

Zhenyang Jin · Answer

Hi JD, thanks for your reply.

How much relocation compensation is proper?

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