District Attorney: Most Sonoma County rental price gouging reports since fires are unfounded
Sonoma County District Attorney Jill Ravitch has heard plenty of complaints about sky-high rents and hotel prices in the aftermath of the region’s devastating fires.
But a report of a big dollar amount alone doesn’t necessarily constitute a violation of the state’s price-gouging law.
“As of this moment we have received over 60 reports of potential rental price gouging,” Ravitch wrote Thursday in an email.
She noted “the majority of these allegations have not been found to violate the law regarding price gouging,” but her staff is “aggressively pursuing evidence on the remaining cases.”
Ravitch added that her office will seek criminal charges or pursue an unfair business practices case for “any instance where the evidence establishes that a violation of the law has occurred.”
Among the nuances of the price-gouging law is that it applies only to previously rented units, not to rentals that have come on the market since the fires.
“If you want to move out and rent your house for a year,” Ravitch said, “you can set whatever price the current market will bear without penalty.”
In addition to the state price-gouging law, the Santa Rosa City Council last month approved an emergency law that limits rent hikes in the city to no more than 10 percent above the price charged for the housing unit before the fires. A similar 10-percent limit is placed on hotels and vacation rentals.
The city also made it illegal to move out an existing tenant and then increase rent for the next renter above the average price charged for the unit during the 30 days before Oct. 9. Exemptions to the increases are allowed when an owner can prove the excess amount of rent is directly attributable to added costs from labor or materials needed for the unit.
Both the state and city provisions apply until April 18, a date specifically set by Gov. Jerry Brown.
Ravitch said some of the price-gouging reports that reached her office have proven to be untrue. Also, she suggested that some high-end vacation rentals may have been rented for hefty amounts, but the owners still haven’t exceeded a 10 percent jump over what the property’s listing prices were before the fires.
“Insurance companies are in bidding wars to find space” for their clients, Ravitch said of such rentals.
Some fire-displaced renters also have shed light on why they likely will pay more to rent their next place. Their old landlords may have kept the rents comparatively low for their former units. But after losing their homes to fire, most such renters now expect to pay market rates.
And county rents have jumped markedly, rising nearly 50 percent from 2011 to 2016.
Property managers suggested rental owners large and small should live by the letter and the spirit of the state price-gouging law.
“Now is not the time for profit taking,” said Jock McNeill, president of Alliance Property Management in Santa Rosa. “Now is the time for rebuilding our community.”