Inherited Tenants no lease

[Dave Frederick]

Hello! Looking for advice here. I’m closing on a duplex, with an inherited tenant paying way under market value. I think California prevents me from signing a lease for more than a 10% increase. She is paying $900 a month, market is about 2200-2500. There is no lease, the prior owner passed away and this house was sold through a trust. All that exists is the tenants monthly payments. 
 
I understand I cannot terminate a lease without cause, but there is none. I know I can’t sign a lease greater than 10% since there’s a documented a MTM rate. Any advice on my options? I heard I have to give a 60 day notice, but can’t find it in writing. Id keep her if it could charge market rents (current mortgage doesn’t support it), so it looks like I have to let her go. I’m interested in options to make the process smooth and legal.

Does anyone have that statute or law for a 60 day notice? Any advice? I’m considering cash for keys as an option as well.

thanks in advance!

[Dan H.]

Are you city of San Diego?  It is relevant because city of San Diego has more stringent rent control than the state.  

You tenant is considered month to month and because they been there longer than a year you must give them 60 days notice of any rent increase.  Lease termination is much harder..

state rent control is AB1482   You can find the city of San Diego rent control by searching sad diego tenant protection act.  It went into effect the middle of 2023

In both cases, you can only terminate a tenant in a duplex that you do not live in for a few reasons.  The most common is to move close family into the unit or a rehab extensive enough that tenant cannot reasonably be expected to live in the unit.  Abatement is the easy way to pass this test. 

If not city of San Diego, the courts have been treating a year residency by family for over 1 year as sufficient indication that it was not done simply to circumvent AB1482.  If you move family in, but truly an unforeseen change occurred you likely are covered.  

If it is city of San Diego you must have permits issued to terminate the lease agreement for rehab.  If you move family into unit, tenant gets first rights to the unit when the family moves out at the rent controlled rate for I believe 3 years.

These lease termination is incorrectly referred to as no fault eviction (it is not an eviction to terminate the lease at the end of the lease term).  For no fault eviction not in the city of San Diego, you must provide the tenant one month rent (in your case $900).  If it is city of San Diego it is to be 2 months rent unless they are elderly or disable where it is the 3 months rent.  

Your best option may be to buy the tenant out.  expect the cost to be significantly higher than the no fault eviction.  

Good luck