Local Landlords Demonstrate Against Announcement Of Legislation To Close Ellis Act Loopholes

In front of an apartment building in San Francisco’s Chinatown this morning, state Sen. Mark Leno announced legislation to help tenants who are being evicted out of homes through what he and others called loopholes in the state’s Ellis Act.

The Ellis Act was enacted in the mid-1980s to allow longtime landlords to leave the rental business. However, the act has been “abused” in San Francisco in recent years, according to Leno, D-San Francisco.

Speculators are buying properties and posing as new landlords, then evicting the tenants within a matter of months to “flip” the building and convert it into a high-cost home or luxury condominiums, the senator said.

On Wetmore Street, a small side street off of Clay Street, Mayor Ed Lee stood with Leno, Assemblyman Phil Ting, D-San Francisco, city supervisors David Chiu, David Campos, Scott Wiener and Norman Yee, and other tenant advocacy group leaders in support of the state bill introduced Friday.

The legislation proposes prohibiting property owners from using the Ellis Act to evict tenants for five years after purchasing a building and limits repeat use of the Ellis Act to evict tenants from multiple homes and carries fines and penalties for violating those restrictions.

According to Leno, more than 300 San Francisco homes have been taken off the rental market through the Ellis Act in the past year.

He called this a “unique problem” for San Francisco, which is experiencing a boom in its economy.

Tenants at the three-unit apartment on Wetmore Street, where today’s event was held, said they had lived at the building for many years before they were told to move. One elderly resident, Piuying Yee, has been at the apartment since 1964 while another couple has lived there for 18 years.

Last year, those tenants were served an eviction notice under the Ellis Act when the longtime landlord sold the property to a development firm.

The tenants are fighting the eviction but continue to live in a sort of housing limbo, uncertain if they can stay or should look for new housing.

Leno said his legislation aims to “protect the existing affordable housing stock” during what he called a “housing crisis” in the city.

He said his bill “restores the original intent of the Ellis Act” to help landlords.

Mayor Lee called the speculative purchases one of the “excessivenesses that occur in this economy” and resolved to curb the practice, as well as fund and build more affordable housing in the city.

Assemblyman Ting vowed to support closing the loopholes to protect tenants.

The Ellis Act “was never meant to be used to throw families on the street to make a few more bucks,” he said.

Ting noted that longtime elderly and disabled residents and many immigrant families are often affected and they “have a right to be here.”

He said Leno’s bill is “one of the many things we have to do to tackle the affordability crisis.”

A group of protesters lined the street this morning demanding that the lawmakers keep the Ellis Act unchanged.

Supervisor Chiu, while acknowledging the protesters, said the reforms in the legislation, including the five-year waiting period, are “not unreasonable.”

Supervisor Campos agreed and said that there has been a surge of Ellis Act evictions displacing longtime renters in his district, which includes the Mission District.

He said the demonstrators, made up of a group of local property owners, should support the bill, which cuts back on people’s ability to “speculate and make a quick buck.”

Noni Richen, president of the Small Property Owners of San Francisco Institute and a landlord of several city apartments for many years, said the Ellis Act should stay the way it is.

Richen said the changes would make it difficult for landlords to get out of the real estate business, which has become too expensive for many owners.

She said the real issue isn’t evictions but rather the “rising and rising costs” for landowners who have to foot the bill on rent-controlled units and will miss opportunities to sell buildings to developers or other property owners.

Sasha Lekach, Bay City News

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  • Joe

    Let the landlords do whatever they want. It’s their buildings. Why do we even have these stupid laws? If your lease has ended, the landlord should be able to kick you out unless you sign a new lease. Use the free market system.

    • mz

      Because the buildings in question are subject to rent control. Otherwise, the Ellis Act wouldn’t really matter. It’s one thing to argue that we should repeal all rent control; I would strongly disagree, but the pros/cons of the system is a reasonable debate to have. But given that we have rent control, the system should be designed to avoid loopholes that undermine it.

    • sjg

      That’s not how the laws work. Not even close. An Ellis evictions does not require a conclusion of the lease nor is it subject to the enactment of a new lease. The stupid law bypasses renter protections.

      • Andrew Roth

        Actually, you can’t evict someone with the Ellis Act if they are under an unexpired lease.

  • Sara Shortt

    This headline seems sensationalist, misleading and unmatched to the content of the article. The story is clearly the introduction of the legislation and the problem of Ellis evictions. Yet the headline implies that the “news” is that this fringe landlord group held a small counter protest. To give them the headline, is to convey that they are the event being covered in the article-which in reading it- it is obvious that they are not the “main event”. Why make it seem as if it is so? The decision to give the “protest” such great attention with this headline raises questions of balanced journalism.

    • eveb

      Hi, Sara! Appeal editor Eve Batey, here. We frequently cover events that are protested (by what might be described as “fringe” elements). In doing so, we frequently highlight the presence of protesters, because we believe that that is relevant to our readership.

      As we’d certainly highlight a protest of tenants rights advocates at a landlordcentric event, I can’t think of anything more balanced than the highlight the inverse. I understand, however, that this issue is of intense personal importance to you, and you might not see it that way.

      • MadlyBranning

        Eve, I tend to agree with Sara on this one. If the protest were huge, or disrupted the event, then it would be the real story here. But it sounds like it was a pretty small part of the event and your headline seems to be the tail wagging the dog. Also, your story completely omits that representatives of Salesforce and Ron Conway (a very powerful player who leads an organization of tech companies in SF) were both at the event advocating for the new law. That was a much bigger story than a few protesters. The tech industry is hugely powerful and if they are advocating for this law (as is the construction trade union) then it has a real impact on whether the bill will be passed, whereas what you reported, frankly, will have little or no impact in Sacramento.

  • Gang of One

    If you bought a rent controlled building, you knew exactly what you were getting in to, so it’s hard to have sympathy for profiteering real estate speculators.