Tenant Buy-outs & Cash-for-Keys, Bracamontes & Vlasak
Serving San Francisco, Oakland, Berkeley, California and surrounding communities
In cities with Rent Ordinances, such as San Francisco, Oakland, and Berkeley, long-term tenants are most at-risk for wrongful evictions by their landlord. Certain landlords will attempt to “buy-out” long-term tenants. These tenancies are particularly valuable because the tenants are usually paying well below fair market rental value. Landlords in cities with Rent Ordinances are sometimes willing to pay these tenants significant amounts of money so they can re-rent the unit for a higher amount.
In other instances, landlords informally contact tenants and claim that they will be performing an owner move-in (“OMI”) eviction because either the landlord or his/her immediate family member will move into the unit. While OMI’s are legal, they cannot be done in retaliation and must be done in good faith. In San Francisco, there can only be one OMI per building – ever. As such, landlords are hesitant to implement an OMI where there is a possibility of negotiating with a tenant for a voluntary move-out.
If you are approached by your landlord concerning a buy-out offer, do not attempt to negotiate the amount by yourself. Most landlords have done this before and attempt to low-ball tenants with unreasonably low offers. Hiring an attorney from Bracamontes & Vlasak, P.C. will give you the leverage you need to maximize your buy-out and help you understand your rights as a tenant.
A "cash-for-keys" arrangement usually arises in the course of a foreclosure, where the bank or real estate agent offers the tenant money to move out. A foreclosure is not grounds for eviction in San Francisco or Oakland. If you are a tenant whose landlord has let the property go into foreclosure, you still have rights.
How much is my tenancy worth? What demand should I make for a buyout of my rent-controlled tenancy in San Francisco?
The value of your tenancy depends on many factors, including its length, the rent-differential (difference between your current rent-controlled rate and market rate for that unit), and whether the landlord can evict you for cause or effectuate a no-fault eviction. Of course, if there's no way the landlord can lawfully get you out of the unit, you will have the most bargaining power. Your plans and the landlord's business plans for the building are also important factors to know when determining how much leverage you have - and hence how much money you can demand - for a buyout. Many factual and practical considerations go into the equation here, in addition to complicated and nuanced legal analyses and arguments.
As a result, buyouts can range anywhere from $2,000.00 to $200,000.00. As a general rule, you should consider factors, including but not limited to, your rent-differential, your plans, your landlord's plans, intentions, resources, and factual research pertaining to same, legal research concerning potential grounds to evict you, potential defenses thereto, and the value a general release might have to your landlord (and/or the value of a mutual release to you), in order to begin to place a value on your tenancy to determine a reasonable buyout number. Landlord tenant law in San Francisco and other rent-controlled jurisdictions can be tricky, so it is important to be sure you're not making bad assumptions and that you are not, for example, walking away from a good offer while unaware of a potential ground for eviction, or accepting a low amount while unaware of a viable defense.
While negotiating a buyout on your own will prevent you from paying attorney's fees, you may also end up getting substantially less money. We represent tenants on negotiable terms that always benefit the client. Sometimes the client is better off paying an attorney hourly and sometimes on a reduced contingency percentage to negotiate a buyout. Having the right tenant attorney on your side who is willing to go to court for you if necessary and who understands the nuances of the San Francisco Rent Ordinance and California landlord-tenant law will almost always substantially increase your recovery so that you end up ahead even after paying attorney's fees. You will also be spared the time and stress of negotiations, which can often be prolonged and contentious.
Here is an example of just some of the questions you should ask and answer before you even make a buyout demand or respond to a pending offer:
1. Am I covered by the SF Rent Ordinance and its just cause requirements for eviction?
2. Does the landlord have a just cause to evict me, or can the landlord effectuate a no-fault eviction, such as an OMI or Ellis Act unlawful detainer?
3. What defenses to an eviction proceeding do I have?
4. Do I fall within a protected class, and might that serve as a valid defense to a potential UD?
5. What is the likelihood that the landlord will see the eviction action through to trial and what is the likelihood that the landlord will prevail?
6. Who really owns my unit and what are their business plans and resources?
7. What is my own BATNA (best alternative to a negotiated agreement)?
8. What is my rent differential and what backup plans do I have if I lose my tenancy?
9. Do I have any grounds for an affirmative lawsuit for habitability or attempted wrongful eviction that bolster the value of a general release to my landlord and hence my bargaining power?
10. Has my landlord been properly educated about the law governing San Francisco evictions?
At BV Law, we've had cases where we've collected from the landlord 100 times the amount that was initially offered to the tenant for a buyout.
If you face a buy-out offer, a “cash-for-keys” offer, or eviction, it is important that you speak with the right tenant attorney. Contact an experienced eviction defense and tenant buyout lawyer at Bracamontes & Vlasak, P.C. to help secure your rights. For a free consultation on your tenancy, call us at 800-392-1427 contact us by e-mail.
Important eviction timeline:
- The landlord serves a three-day notice (or a 30-day or 60-day notice);
- After the notice expires, the landlord can file a lawsuit (unlawful detainer);
- After the complaint has been served to the tenant, the tenant has five days to respond in writing to the court. Proper responses include, but are not limited to, demurrer, motion to quash service of summons, motion to strike, or an answer.