The First Appellate District of the California Court of Appeal held that local rent control laws can apply to individual rooms rented in a single-family home.

Jonathan Owens owns a single-family home in Oakland. He rents out three of the bedrooms in this home to separate tenants on a month-to-month basis, terminable upon 60 days’ notice. Each tenant has their own private room, and the common areas of the house are shared between the tenants and Owens.

One of the tenants filed a petition with the Oakland Residential Rent and Relocation Board alleging that her housing became uninhabitable due to disruptive construction work in the house. She also alleged that Owens retaliated against her by terminating her lease when she complained about the construction work. Owens argued that the Board has no jurisdiction over the matter because under state law his single-family home is exempt from local rent control regulations. The Board found otherwise and determined that he had transformed his single-family home into a multi-unit building, and therefore the Board’s rent control regulations were applicable.

Under California’s Costa-Hawkins Rental Housing Act (Civil Code Section 1954.5 et seq.), local jurisdictions have the authority to enact rent control under certain conditions. However, under the Act single-family homes are generally exempt from local rent control. Owens sued the Board arguing that because his property is a single-family home the local Board has no jurisdiction. The trial court found otherwise, and Owens appealed.

Civil Code Section 1954.52 exempts single-family homes from local rent control because single-family homes are generally single units, “alienable and separate” from title to any other dwelling unit (Civil Code Section 1954.52(3)(A)). Rent control under the Act generally only applies to multi-unit structures. But the Appeals Court held that because Owens chose to rent out rooms separately to multiple people, he transformed his single unit dwelling into a multi-unit dwelling.

The Appeals Court noted that a dwelling unit is not necessarily the entire property to which an owner holds title, instead it is an area inhabited by someone to the exclusion of others. Citing the trial court, the Appeals Court noted that the relevant dwelling unit is not the house as a whole, but each of the rooms he rented out to tenants. Therefore, the Appeals Court agreed with the trial court and held that the individual rooms that Owens rented out to individual tenants are not exempt from the Board’s rent control and jurisdiction over the matter.

Print:
EmailTweetLikeLinkedIn
Photo of Lance Shoemaker Lance Shoemaker

Lance has represented public and private clients in matters involving real estate, land use, environmental contamination, lease negotiations, corporate formation, outdoor advertising, municipal finance, and general business transactional work. His real estate experience includes property sales and acquisitions, due diligence, title insurance negotiations…

Lance has represented public and private clients in matters involving real estate, land use, environmental contamination, lease negotiations, corporate formation, outdoor advertising, municipal finance, and general business transactional work. His real estate experience includes property sales and acquisitions, due diligence, title insurance negotiations, property management, entitlement/permit processing, environmental investigations and indemnity protections, redevelopment, and code enforcement. For Colantuono, Highsmith & Whatley’s clients, his work has included a broad range of real estate transactions as well as negotiating, documenting and interpreting development, construction and reimbursement agreements between the firm’s public agency clients and developers and contract utility operators.