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Your Legal Corner - Client Alert Blog

New City of Beverly Hills Rent Control Laws Effective January 25, 2017

Written By: Melissa C. Marsh, Esq., California Attorney, January 2017 Add to Favorites

Effective January 25, 2017, the City of Beverly Hills has implemented new stringent rent control rules applicable to ALL rental units. The newly enacted Beverly Hills Rent Control Laws rival those in place in West Hollywood and Santa Monica.

City of Beverly Hills Maximum Rent Increase Limited to 3% In 2017.

Previously, residential units in Beverly Hills were restricted to a maximum 10% annual rent increase. Effective January 25, 2017, a landlord can only raise the rent a maximum of 3% on residential units located in the City of Beverly Hills with Chapter 6 Tenants (tenants whose move-in rent was $600 or more per month). Effective January 25, 2017, a landlord can only raise the rent a maximum of 1% on a residential unit in Beverly Hills with a Chapter 5 Tenant.

City Of Beverly Hills Now Requires Relocation Assistance For No Cause Evictions.

Previously, residential units in Beverly Hills only required the payment of relocation expenses to tenants subject to a no-cause eviction pursuant to a 60 Day Notice to Quit that were covered by Beverly Hills Municipal Code Section 5 (“Section 5 Tenant”). A Section 5 Tenant is a tenant whose most recent lease, or rental agreement, stipulates a move-in rent of $600, or less, per month. Effective January 25, 2017, a no cause residential eviction of a Beverly Hills tenant pursuant to a 60-day Notice to Vacate for both Chapter 5 and Chapter 6 Tenants (tenants with a move-in monthly rent of $600 or more) requires payment of the following relocation fee:

Relocation Assistance For Beverly Hills Rental Units
Unit Type Relocation Fee Tenant Age 62+, Disabled,
or Has Minor Children
Bachelor or Single $ 9,050 $10,350
One Bedroom $13,900 $16,000
Two bedroom $18,500 $21,650

If a landlord decides to terminate a Beverly Hills residential tenancy for no-cause with a proper 60-Day Notice and payment of the required relocation fee set forth above, the landlord should be aware that the rental unit will remain “rent controlled.” This means the landlord will not be permitted to increase the rent for that rental unit until a full 365 days has passed since the prior tenant vacated the unit.

If on the other hand, a tenant in a Beverly Hills rental unit is evicted for “just cause,” or voluntarily vacates (e.g. through a cash for keys agreement, or buyout agreement), then the landlord is permitted to increase the rent to whatever the landlord deems is the fair market value.

Just Cause Reasons to Terminate a Beverly Hills Residential Tenancy Requires a Three Day Notice to Cure or Quit and include:

  1. failure to pay rent [Section 4-5-502];
  2. violation of a rental obligation [Section 4-5-503];
  3. maintenance of a nuisance [Section 4-5-504];
  4. illegal use of the apartment unit [Section 4-5-505];
  5. refusal to provide access to the rental unit [Section 4-5-507];
  6. allowing an unapproved subtenant [Section 4-5-508]; and
  7. removal of a manager to move in another manager [Section 4-6-06].

Can a landlord evict a Beverly Hills tenant to remodel the rental unit? Yes, but such is not considered a just-cause for eviction. In such an event, the landlord would be required to serve a proper sixty (60) day written notice of termination of tenancy, to pay the required relocation fee, and once the remodel is complete to re-rent the rental unit at the previous tenant's rent rate. See, Beverly Hills Municipal Code § 4-6-6. Now, if an agreement between the landlord and the tenant can be struct, and the tenant voluntarily vacates, then the rental unit would become decontrolled.

What about Interest on the Tenant’s Security Deposit?

Neither the old, or new, Beverly Hills Rent Stabilization laws requires the payment of interest on a tenant's security deposit.

What can a landlord do if a Beverly Hills tenant moves in additional occupants not named on the lease?

If the lease, or rental agreement, allows for only a certain number of renters, or limits the occupants to the named renters only, and the tenant moves another occupant in the landlord can: (1) negotiate a new rental agreement; (2) serve a Three Day Notice to Cure or Quit and begin eviction proceedings if there is a failure to comply; or (3) pursuant to state law, raise the rent 10% for each additional occupant. These option, however, do not apply if the additional occupant is a first born child.

Beverly Hills Rent Control Maintains Required 24 Written Notice Of Tenant’s Rights.

Landlords with residential properties in Beverly Hills should also be mindful that they are still required, prior to the execution of a lease, or rental agreement, to provide all prospective tenants whose rent will be more than $600 per month (a tenant covered under the City of Beverly Hills Municipal Code, Chapter 6 ) with at least 24 Hours Prior Written Notice of their rights and responsibilities. Again, this Notice must be given to the prospective tenant at least 24 Hours BEFORE the tenant signs a lease, or rental agreement. Here is the sample Notice provided by the City of Beverly Hills.

Landlords with Properties in Beverly Hills Should IMMEDIATELY get a New Standard Lease Agreement.

If you have a residential rental property in the City of Beverly Hills, and you have been using a standard CAR form lease, or god forbid some other document found off the internet, you should contact a landlord-tenant attorney to prepare a custom written lease agreement to maximize your protections.

Tags: Beverly Hills Rent Control
Posted In: Real Estate Reporter 

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Located in Los Angeles, California, the Law Office of Melissa C. Marsh handles business law and corporation law matters as a lawyer for clients throughout Los Angeles including Burbank, Sherman Oaks, Studio City, Valley Village, North Hollywood, Woodland Hills, Hollywood, West LA as well as Riverside County, San Fernando, Ventura County, and Santa Clarita. Attorney Melissa C. Marsh has considerable experience handling business matters both nationally and internationally. We routinely assist our clients with incorporation, forming a California corporation, forming a California llc, partnership, annual minutes, shareholder meetings, director meetings, getting a taxpayer ID number (EIN), buying a business, selling a business, commercial lease review, employee disputes, independent contractors, construction, and personal matters such as preparing a will, living trust, power of attorney, health care directive, and more.