LANDLORD

San Francisco scorns landlords. Old-time melodramas made them villains seeking to evict kindly families unless granted the favors of a nubile maiden daughter. The citizenry recently voted to provide renters facing eviction public funding for legal representation. Yes, renters can get screwed. So can landlords. Ask Greg.

A senior, Greg owns a four-unit building—he lives in one—in southeastern San Francisco. Once, he also owned a house in Bernal Heights. The two properties drained his resources, so he sold the house and retained the apartments to provide income for his old age. Rent control has depressed that income. He figures his rents are about one-third of market. They cover less than his mortgage and insurance. Upkeep comes out of his pocket.

It gets worse. One of Greg’s tenants is a drug user with mental problems. Greg calls him “barking mad.” About five years ago, he was taken in as a subtenant by another tenant. The master tenant left. Failing to reach an understanding with his own attorney, Greg accepted rent from the “new tenant.” That put the man practically out of reach.

The new master tenant trashed the apartment—carpeting ruined, the stove filthy. He also used it as a drug flop house with all kinds of people staying over. Topping that, he moved a family into the separate garage that’s part of his unit—and collected rent. That’s illegal. It also exposed Greg to legal problems if the children there were hurt.

In April, Greg started procedures to evict the people in the garage. The master tenant had thirty days to respond. He didn’t. The people in the garage went to a tenants’ help organization. That stopped the eviction. A month-and-a-half later, Greg’s attorney and the family’s pro bono lawyer reached an agreement. The family would leave in mid-July, and Greg would pay them $5,000. A jury trial would have cost Greg $15,000.

In the next weeks, the master tenant will receive notice of the date he will be physically evicted. If he refuses, he can demand a lawyers’ conference and jury trial. Over the past three months, Greg has not accepted rent. California law stipulates that if Greg takes money, he ends the eviction procedure.

Greg hopes that the process costs him “only” $15,000. It will take another $10,000 to clean up the apartment. He regrets always being a little “loose” with tenants out of kindness to the less fortunate. “From now on, I’m going to demand a squeaky-clean record and an upscale job.” He reflects with sadness that he will now be “one of those gentrifying landlords.”

Greg considers not keeping the Bernal Heights home “one of the worst financial decisions I ever made.” He cautions, “Most San Franciscans don’t realize how difficult it can be to be a small landlord. If this happened twenty years ago, I’d have gone into debt.”

He emphasizes that the situation would be more just if landlords had a right to demonstrate to a court that his rents are way under market and should rise to a fair level. He figures that his below-market rents cost him— conservatively—$36,000–$40,000 a year. “It also should be easier to remove a tenant whose behavior is unconscionable.”

No matter how reasonable those observations, Greg does not anticipate relief any time soon.

To respond, click on “comments” to the right just below the title of this post. Then go to the response space at the bottom of the post.

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10 Comments


  1. Carolyn Power
    Jun 22, 2018

    Sometimes there is no justice. Greg is clearly subsidizing his tenants & although they are within their legal rights with rent control, it feels very unfair as though it’s his obligation to provide free rent as market values & his expenses rise. As for the family he had to pay to leave—that smacks of legal grifting. I hope for a good outcome and a timely eviction.


    • David
      Jun 22, 2018

      Thanks, Carolyn. Greg hopes for a good outcome, but as I replied to Jerry Hurwitz, it will come at a cost. And his rents remain below-market.


  2. Gerald Hurwitz
    Jun 22, 2018

    I know someone that sounds exactly like “Greg”. Are all of “Greg’s” problems for real or are some of them fiction? This “friend” of mine has many times referred to how bad his rent controlled units are, but I never stopped to ask him to tell us what he was experiencing. It makes me feel bad that I have not been a better listener.


    • David
      Jun 22, 2018

      Greg’s problems all are real, Jerry. Someone emailed me that he sounds like a bad businessman. I’d say soft-hearted. But I replied that he as a landlord is assumed to be wrong and has to jump through hoops to make his case—at considerable cost.


  3. Tracy
    Jun 22, 2018

    Rent control is a huge problem. However, it is now so entrenched in our SF mindset that it’s unlikely to ever go away. It does indeed force land owners to subsidize housing for tenants. Essentially a form of socialism. And, as Margaret Thatcher once said “the problem with socialism is that eventually you run out of other people’s money.”


    • David
      Jun 22, 2018

      I agree, Tracy, that some—perhaps many, maybe most—people love other people’s money.


  4. Joe Sutton
    Jun 22, 2018

    When my wife Joan and I bought our house 24 years ago, four of the rooms were being rented out to tenants. We had trouble convincing two tenants that we wanted to live in our own house. We had to pay a lawyer to write a letter and I had to deliver it to the two stubborn tenants. As things turned out, we had to pay them more than $3000 to leave the house we had just bought. I understand that renters need help, but so do people who buy a house with greedy renters in it.


    • David
      Jun 22, 2018

      Joe: I get it. And it’s a bad situation.


  5. Sandy Lipkowitz
    Jun 23, 2018

    Rent control has never been a good solution in any city. It contributed to the high rents in SF. It took rental stock out of the market as apartments were converted to condominiums. For years no new rental housing was built until rents started to skyrocket. Good landlords are penalized and like Greg, now have to raise rents as high as they can when they get a vacancy. It doesn’t help the people it was intended because now landlords will only want to rent to people with the highest incomes and best credit.

    That said I am a renter and I benefit from the suppressed rent I have. Otherwise I wouldn’t be able to live in SF. I feel if the market had not been tampered with, things would have been more equitable all around


    • David
      Jun 23, 2018

      Sandy, you bring up good points. This should not be a matter of either/or but finding a market-oriented solution that provides reasonable protections to both landlords and renters. Black-and-white thinking will not help us. The matter is complex, but we can improve on the situation.

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