Acquiring Tenants and Need Guidance on How to Best Handle
Daniela DamjanoskiPro Member
Member since 2023 · 14 posts · 3 votesI just purchased a property that has two homes in San Diego, CA. We will be living in one and the other one is already rented out. There are tenants in there that have been on a month-to-month lease as they sellers knew that they would be selling. What do I need to do to get them on a lease? Can it be a short-term lease (i.e., 3 months)? Also, what if I wanted to give them notice. Is it 60 days and how do I go about doing that? Do I need to hire a lawyer to give them notice or to create a new lease for me. Any guidance and advice is appreciated.
@Dan H. Thanks for that catch! That's good to know regarding the timeline of the purchase and the tenants occupying the space. Question - can the new lease be completely new in regards to the total or does it stil have to abide by the rent increase limits? Also can she put a new security deposit requirement in?
There cannot be a substantial change of the lease terms. I do not consider increasing the security deposit in line with deposit rules (deposit same as rent) to be a change of lease terms. So it is my view that the deposit can be raised to equal the rent at each rent increase.
@Daniela Damjanoski are you familiar with the deposit rules? Going forward you need pictures both before and after to charge from the deposit. I do not believe the before pictures applies in your case because your tenant occupancy precedes the law (who would have pictures of everything before a law dictated you must have pictures?). However, how do you know the damage was not present at tenant move-in? Unless the current landlord has pictures that they provide to you, you likely will not be able to collect for any damage that precedes your acquisition. You have 17 days to provide the tenant the accounting, photos, and their remaining deposit.
Make sure you know the landlord/tenant rules or hire a pm that knows the rules.
Good luck
Hi Daniela!
Congratulations, that's so exciting! I’m not a lawyer, but wanted to share what I’ve learned as a landlord and homeowner in California with some additional research too.
California Civil Code §1946 outlines the requirements for terminating month-to-month tenancy. For tenants who have resided in the unit for 1 year or more, a 60-day written notice is required. If the tenancy is less than a year, a 30-day notice suffices. Note: there are specific requirements to make this legal including it be in writing., include the date of service and the effective date of termination, state clearly that the tenancy will end, and it can be delivered personally or via certified mail with return receipt requested.
Since you are living on site, you are likely exempt from the just cause eviction rules under AB 1482. This means you don’t need a specific reason to evict so you can issue a 60-day notice to terminate the tenancy (if they’ve lived there over a year).
Here is a good article on it too: https://caanet.org/dont-forget-to-provide-the-required-notic...
Another question would be if you have been able to see the current tenants payment history, credit reports, etc to make sure you want to continue renting to them? I personally like to have tenants with really good credit, stable jobs, good landlord references, etc. to make sure they are reliable tenants before signing them on long term. Also, do you have access to their current lease so you can see if there are any specific added terms in there?
Lastly, if you end up needing a new lease: For my leases, I used the standard one from a site called Avail. This is a leasing platform that allows you send and Docusign leases, collect security deposits, track payments, complete background checks, view credit scores etc. If you are newly listing a home for rent, it even posts it out to all of the platforms for you, and automates the application process. I rented out my La Mesa property to long term tenants for about 4 years, and have had one turnover (my initial tenants moved to Hawaii). It has been hugely beneficial for me throughout these last few years!
Hopefully that was helpful, let me know if you have any follow up questions!
Brianna
Hi Daniela!
Congratulations, that's so exciting! I’m not a lawyer, but wanted to share what I’ve learned as a landlord and homeowner in California with some additional research too.
California Civil Code §1946 outlines the requirements for terminating month-to-month tenancy. For tenants who have resided in the unit for 1 year or more, a 60-day written notice is required. If the tenancy is less than a year, a 30-day notice suffices. Note: there are specific requirements to make this legal including it be in writing., include the date of service and the effective date of termination, state clearly that the tenancy will end, and it can be delivered personally or via certified mail with return receipt requested.
Since you are living on site, you are likely exempt from the just cause eviction rules under AB 1482. This means you don’t need a specific reason to evict so you can issue a 60-day notice to terminate the tenancy (if they’ve lived there over a year).
Here is a good article on it too: https://caanet.org/dont-forget-to-provide-the-required-notic...
Another question would be if you have been able to see the current tenants payment history, credit reports, etc to make sure you want to continue renting to them? I personally like to have tenants with really good credit, stable jobs, good landlord references, etc. to make sure they are reliable tenants before signing them on long term. Also, do you have access to their current lease so you can see if there are any specific added terms in there?
Lastly, if you end up needing a new lease: For my leases, I used the standard one from a site called Avail. This is a leasing platform that allows you send and Docusign leases, collect security deposits, track payments, complete background checks, view credit scores etc. If you are newly listing a home for rent, it even posts it out to all of the platforms for you, and automates the application process. I rented out my La Mesa property to long term tenants for about 4 years, and have had one turnover (my initial tenants moved to Hawaii). It has been hugely beneficial for me throughout these last few years!
Hopefully that was helpful, let me know if you have any follow up questions!
Brianna
>Since you are living on site, you are likely exempt from the just cause eviction rules under AB 1482.
this is incorrect. A owner occupied duplex is only exempt from AB1492 if the owner has lived on the property longer than the tenant which is not the case for the OP.
@Daniela Damjanoski read and understand AB1482. If you are in the city of San Diego, the tenant protection act of 2023 also applies. The tenant protection act is more stringent and costly than AB1482. In both cases the common ways to terminate a tenant are a rehab that is extensive enough that the tenant cannot live there for the effort or to move family in. San Diego city has placed high hurdles on the unit rehab, but abatement will work. This implies taking down older texture ceiling with asbestos probably qualifies. You will need a permit to get the tenant out in city of San Diego. The term AB1482 uses for this is a no fault eviction (terrible name). No fault eviction costs 1 month rent statewide, 2 month’s rent in city of San Diego (3 month’s rent if they are senior or handicap).
Hopefully you did all your research before purchasing and the tenants are paying close to market rent and that the tenants have been fully and thoroughly vetted. It is not easy to get rid of poor tenants in MF in CA especially if they are paying below market rent.
Good luck
@Dan H. Thanks for that catch! That's good to know regarding the timeline of the purchase and the tenants occupying the space. Question - can the new lease be completely new in regards to the total or does it stil have to abide by the rent increase limits? Also can she put a new security deposit requirement in?
@Dan H. Thanks for that catch! That's good to know regarding the timeline of the purchase and the tenants occupying the space. Question - can the new lease be completely new in regards to the total or does it stil have to abide by the rent increase limits? Also can she put a new security deposit requirement in?
There cannot be a substantial change of the lease terms. I do not consider increasing the security deposit in line with deposit rules (deposit same as rent) to be a change of lease terms. So it is my view that the deposit can be raised to equal the rent at each rent increase.
@Daniela Damjanoski are you familiar with the deposit rules? Going forward you need pictures both before and after to charge from the deposit. I do not believe the before pictures applies in your case because your tenant occupancy precedes the law (who would have pictures of everything before a law dictated you must have pictures?). However, how do you know the damage was not present at tenant move-in? Unless the current landlord has pictures that they provide to you, you likely will not be able to collect for any damage that precedes your acquisition. You have 17 days to provide the tenant the accounting, photos, and their remaining deposit.
Make sure you know the landlord/tenant rules or hire a pm that knows the rules.
Good luck
@ Dan H. I will ask for the photos in case they happen to have them. I have been reading up on AB1482 and I don't see where it specifies that the owner has to have lived on the property longer than the tenant. The previous owners where not living on the property, however my husband and I will be living in the vacant home. As it's only one home, I was not going to hire a property manager. Perhaps it is better that I do speak to an attorney. I'm not sure if it's appropriate for me to ask on this forum, but do you (or anyone else) have any recommendations for ones that deal with San Diego properties.
@ Dan H. I will ask for the photos in case they happen to have them. I have been reading up on AB1482 and I don't see where it specifies that the owner has to have lived on the property longer than the tenant. The previous owners where not living on the property, however my husband and I will be living in the vacant home. As it's only one home, I was not going to hire a property manager. Perhaps it is better that I do speak to an attorney. I'm not sure if it's appropriate for me to ask on this forum, but do you (or anyone else) have any recommendations for ones that deal with San Diego properties.
Search for the word “duplex”. It is the 1st occurrence.
https://leginfo.legislature.ca.gov/faces/billTextClient.xhtm...
(6) A duplex in which the owner occupied one of the units as the owner’s principal place of residence at the beginning of the tenancy, so long as the owner continues in occupancy.
Note the owner occupancy exemption only applies to 2 unit properties where the owner has lived continuously in the unit since before the tenant. The same owner occupancy exemption never applies to more than 2 units.
Good luck