All Forum Posts by: Kai George
Kai George has started 2 posts and replied 4 times.
Post: Inherited tenants and rent increase under Los Angeles rent control
- Posts 4
- Votes 1
Hi there!
I'm considering offering on a 3 unit property. Two units will be vacant upon closing. I plan to fix up one and rent at market, then house hack in one of the units. The tenant that will be remaining is paying $876 per month. The unit after some updating could easily go for $1,800. My question is how difficult, under Los Angeles rent control would it be to raise the rent after the lease is up? Is this a deal you would pass on? I think it's a great deal, so long as I can raise rents to market. Thoughts?
Post: Raising rents on Section 8 Month-to-Month tenants
- Posts 4
- Votes 1
Quote from @Tony Kim:
Quote from @Kai George:
Hey BP Fam! I'm considering placing an offer on a triplex in south Los Angeles as a house hack. Two of the potentially inherited tenants are section 8 and paying month to month! Both units are renting about $400 -$500 below market rents and my goal is to raise the rents to market value after I move in. How would you approach this? Is there anything I should keep in mind? My plan after closing is to give a 30 day notice to tenants, and submit a rent increase form to the county to see about raising rents. Does this process sound correct? How likely do you think the county is to accept this request? The house will need some repairs, and I doubt I'll have the funds to renovate all at once, so keeping some income coming while doing smaller upgrades would be ideal!
Also, I've been doing research on LA specific laws, but things are confusing with the Statewide rent control, and now the Covid-19 renters protection laws, plus nothing I'm finding is specific to section 8--Any insight regarding how the new laws might affect the plan I mentioned above? Thanks!
$400 to $500 below market is actually not that bad. HACLA payment standards have been going up so fast, that even with annual increases, we generally cannot keep up with the max payment standard. I seriously can't believe I'll be renting my most recent 1 bedroom in one of the poorest areas of LA for $1,926.
Implementing a rent increase for a Section 8 property is actually extremely easy, and for your reference, assuming your property falls under RSO, you will be able to increase rent by 8.6% this year. All you need to do is submit a rent increase request via the owner's portal. COVID restrictions on rent increases are no longer in effect. Quite frankly, the part where you will be submitting forms as the new owner will be the most tedious part.
Also, rent control in LA is not as complex as people are making it out to be. If your triplex was built before 1978 and you are in the city of LA, you will most likely be subject to the city's RSO program. That's really all you need to focus on.
@Tony Kim This is awesome info! Thanks So much! Actually the property is in a non RSO area of los angeles--But I do know that California has a statewide Rent control in place (still doing research on this as you mentioned there's a ton of layers :/). I do have a follow up question to your response--Even if rent control is in place, if tenants are month-to-month from what I've read I should be able to raise rents beyond just 8% to market value, after giving the correct amount of notice, correct? I thought the 8% only applied to year long leases.
Post: Raising rents on Section 8 Month-to-Month tenants
- Posts 4
- Votes 1
Thanks for the breakdown Carl! I Appreciate the response!
Post: Raising rents on Section 8 Month-to-Month tenants
- Posts 4
- Votes 1
Hey BP Fam! I'm considering placing an offer on a triplex in south Los Angeles as a house hack. Two of the potentially inherited tenants are section 8 and paying month to month! Both units are renting about $400 -$500 below market rents and my goal is to raise the rents to market value after I move in. How would you approach this? Is there anything I should keep in mind? My plan after closing is to give a 30 day notice to tenants, and submit a rent increase form to the county to see about raising rents. Does this process sound correct? How likely do you think the county is to accept this request? The house will need some repairs, and I doubt I'll have the funds to renovate all at once, so keeping some income coming while doing smaller upgrades would be ideal!
Also, I've been doing research on LA specific laws, but things are confusing with the Statewide rent control, and now the Covid-19 renters protection laws, plus nothing I'm finding is specific to section 8--Any insight regarding how the new laws might affect the plan I mentioned above? Thanks!