Owner or Relative Move-In Eviction-- Bay Area

[Alexander Canha]

Hey BP,

I'm currently in the market looking for a small multi-fam to house hack in the Bay Area (SF, Oakland, Berkeley). I recently learned about the 'owner move in eviction,' and was curious to know if anyone in the Bay Area had experience with this and wanted to share their experience or share their knowledge? Thanks!

[Houston Garcia]

@Alexander Canha - As @Account Closed mentioned, owner Move-In Evictions are allowed, but there is currently a moratorium on them. In a pre-COVID world, you'd give a 60 notice, and pay relocation fees. A sure-fire way to move into your property as an owner-occupant.

Currently, tenants cannot be evicted except for limited circumstances. For example: 1) Ellis Act - removing rental units off the market or 2) A health & safety issue that poses an imminent threat to tenants or neighboring residents. A tenant buyout agreement (which is NOT cash for keys) is the closest thing you can get to an OMI nowadays. 

A problem arises with tenant-occupied properties (say a tenant-occupied SFH) that you want to move into: you can only discuss a tenancy buyout AFTER close of escrow. You cannot discuss buyouts or evictions with tenants before or during escrow - that could be construed as constructive eviction and land you in legal hot water. Since the OMI is temporarily off the table, you have no sure way of moving into a tenant-occupied property as an owner once you take possession. You can only offer a tenancy buyout after closing (and you should do it properly through an attorney). So be very careful, especially if you have an owner-occupant loan that requires you to move into the property within a certain amount of days (usually 60 or 90).

Eventually, the eviction moratorium will be lifted, bringing us into a whole new landlord-tenant landscape. For the better or worse, the pandemic has fundamentally changed the dynamics of landlord-tenant relationship.

Disclaimer: I am not a licensed real estate attorney, consult with a legal professional (happy to make referrals).