Tenant and replacement questions re: SB 330/SB 8

[Laure Jo]

A lot of legislative things in CA this month. I have a question about SB 330, which was just extended until 2030 with the signing of SB 8.

I have a fourplex in LA County (not city) that is fully occupied. In the future, I'd like to raze it and build two or three units, depending on the funds and plan in the future. The fourplex only exists because the zoning has been grandfathered in, on paper it is R2.

This is my understanding of how SB 330 would affect my project:

• If I raze the building, I can't build anything less than four units ("An affected city or an affected county shall not approve a housing development project that will require the demolition of occupied or vacant protected units, unless all of the following apply: (A) (i) The project will replace all existing or demolished protected units.)
• Additionally, because the units exist under rent control (market rate), the rents of the new buildings in the future must also be rent controlled. (Same quote as above)
• I won't be evicting tenants so would be planning my project around them leaving naturally. I am reading correctly that I would not have to offer any first right of return to people who leave voluntarily?
• According to YIMBY Law's interpretation of the law, the new buildings that replace the old ones have to be made affordable as defined by HUD, even if the current rents in the old building aren't. And this affordability has to stick for 55 years.

Am I misinterpreting this? This seems really draconian and discourages anyone to build anything new...

[Bruce Woodruff]

Originally posted by @Laure Jo:

Originally posted by @Bruce Woodruff:

Why would you want to have anything to do with Real Estate in California? Letting a Government run your business is not my cup of tea....

Having said that, if you can tolerate the Govt being involved, you can make a lot of money...just play the game.

 Yeah, so true, especially if I'm reading this bill correctly. Family has been here for generations and I inherited a lot of property here in SoCal tho and am trying to figure out what best to do with them in next 10-15 years.

Sell everything now while the market is topped out. Move to a state that will mind it's own business (as much as possible). Relax and enjoy life.....