California officials warn against price gouging as rents soar in fire-stricken Los Angeles

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Southern California’s expensive housing market will become more competitive after deadly firestorms burned more than 12,000 homes and other buildings in the Los Angeles area, leaving tens of thousands of people without a place to stay.

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There are already reports of rent gouging, prompting elected leaders to issue stern warnings against the practice and implore the public to report unethical landlords who raise rents above the allotted 10% cap.

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California Attorney General Rob Bonta said in a statement Saturday that it is illegal for landlords to accept rent that exceeds the maximum, even if someone offers to pay a higher amount.

“You cannot raise prices and take advantage of disaster victims, plain and simple,” he said in a press conference.

For example, a modern three-bedroom apartment in a downtown Los Angeles high-rise, which was listed for $5,500 a month in October, appeared again on Zillow this week with a new rent of $8,500. On Saturday, the list was removed.

The entire state has struggled with the dual crises of housing and homelessness, and has only recently begun to make inroads into building affordable housing.

Does the law allow landlords to increase rents?

California law prohibits price gouging after a state of emergency is declared, meaning that individuals and businesses cannot increase the prices of goods and services such as gas or rent by more than 10% before a state of emergency is declared.

Price gouging is a misdemeanor punishable by up to one year in prison and a $10,000 fine for each violation.

Housing-related protection is generally valid for 30 days. But on Thursday, Gov. Gavin Newsom extended the ban on motels, hotels and rental housing through March 8.

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Is there evidence of increasing rents in the Los Angeles area?

Tenants’ rights groups and landlords’ associations have called for tough enforcement against rent gougers amid media reports of obscenely high prices.

People on social media are examples of crowdsourcing hyperbole, and even enter their findings into a shared Google Doc.

For example, a four-bedroom, four-bathroom home in Encino, which was seeking renters at $12,000 a month in December, was relisted on Jan. 13 with a new price of $14,000. A three-bedroom, four-bathroom home in Los Angeles that was listed for rent for $16,000 in September was relisted this week at $29,000 per month.

They all exceed the 10% maximum. By Saturday, both lists had been removed.

What assistance does FEMA provide to people who need housing?

IDPs with homeowners or renters insurance can receive living expenses for staying in a hotel or rental.

FEMA has several programs for displaced residents. Short-term stays at participating hotels and motels will be paid for. They also provide cash in advance for housing through displacement and rental assistance programs.

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FEMA also reimburses out-of-pocket housing expenses not covered by insurance.

What about mortgage relief for homeowners?

Newsom’s office announced Saturday that five major banks have agreed to provide mortgage relief to affected homeowners, including a 90-day grace period on mortgage payments, a 90-day late fee waiver, and a moratorium on new mortgage foreclosures for 60 days. Up to 90 days. .

The banks are Bank of America, Citi, JPMorgan Chase, U.S. Bank and Wells Fargo.

Do housing platforms help with anti-gamming enforcement?

Short-term rental platform Airbnb said Wednesday that hosts in Los Angeles and Ventura counties who try to raise prices by more than 10% will receive an error message instead. The company is also sending reminders to hosts that price gouging during an emergency is illegal.

Zillow publishes “Important Information for Renters During a State of Emergency” about area rentals, informing applicants of the law.

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