In the Beverly Grove area of Los Angeles, rent for a two-bedroom condo jumped from $5,000 to $8,000 because of a fire that started last week and left thousands homeless.
In Venice, a single-family house saw a jump of about 60%. In Santa Monica, an owner listed a five-bedroom house for $15,000 more than they were asking last year – a profit of more than 100%.
Temporary abatement protections in place because of the fires are supposed to stop dramatic rent increases, but a Times review of online listings this week shows illegal increases are common. Listings of this type, which have been circulated on social media, have sparked an uproar, causing some landlords to change course and leading to calls for authorities to prosecute those profiting from pain.
“They need to move quickly and make an example of these people,” said Larry Gross, executive director of the Coalition for Economic Survival, a local employers' rights group.
Even other homeowner associations are joining the chorus.
“They threw a letter,” Fred Sutton, executive vice president of the California Apartment Assn., told the LA City Council on Tuesday.
California furlough laws begin following a declared state of emergency and last for 30 days unless extended. In the case of local fires, that means landlords generally can't charge more than 10% more than they were charging or advertising before Jan. 7.
California Atty. Gen. Rob Bonta has warned property owners and the public about the rules and vowed to deal directly with violators.
Bonta's office did not disclose the number of price gouging complaints it received. But Bonta has deployed teams of lawyers from his offices throughout the province to examine those submitted, said the agency's spokesperson.
“It is important that the victims of this fire are treated with respect, dignity and fairness,” Bonta said at a press conference in Los Angeles on Saturday. “The payment of the price is illegal. We will not stand for it.”
If convicted, homeowners face up to one year in jail and thousands of dollars in fines. But the issue has not been prosecuted after the last major bushfire and some tenant lawyers say price gouging is now more common, because people think they can get away with it.
In 2018, the attorney general's office filed only two lawsuits against landlords and real estate agents for alleged illegal price increases following wildfires that destroyed thousands of homes in Northern California. Following complaints from local lawyers and prosecutors that the law was too difficult to enforce, state legislatures expanded it later that year.
At the urging of Los Angeles City Council Member Traci Park, the city moved Tuesday to increase fines for price gouging to $30,000 and ensure it has the resources to investigate and prosecute cases.
In some ways, modern technology makes it easier than ever to track potential violations.
As the fires continue to burn, tenant advocates and everyday people scour rental listing websites and compile shared databases of suspected burglaries, sharing them with authorities and the media and on social media.
Chelsea Kirk, editor-in-chief of One Spreadsheet, said the practice appeared to be “widespread and rampant” and that people were taking their anger out on landlords and agents.
“People call me and say, 'I make it my hobby today to call everyone on the list and tell them what they're doing is illegal,'” said Kirk, director of policy at the nonprofit Strategic Actions for a Just. The economy.
So far, it seems to be working. Many listings that have reduced prices have been removed or listed at 10% or less.
Chad Singer, a real estate agent with Amalfi Estates, said part of the problem is a lack of knowledge of the rules among homeowners.
“The people I taught quickly changed it when they realized it was illegal,” said Singer.
There are still problems. Singer said leases have been signed at inflated prices, increasing the likelihood of tenants signing lawsuits. There are also bidding wars that occur without any formal listing.
One man told the Times that his brother-in-law showed up at a rental house near Brentwood and the listing agent told him to fill out a form with his best offer.
“We think it's still going on in the shadows,” said Anya Lawler, a policy attorney with the California Rural Legal Assistance Foundation, noting that such cases can be difficult to prosecute.
He is also concerned that price increases may pick up again after the pullback. “We're not out of the woods by any stretch of the imagination,” he said.
Some real estate companies take action, where they can.
Zillow, a popular real estate listing website, allows viewers to see the history of rent changes on listings and has been featured in social media posts.
Emily McDonald, a spokeswoman for the company, said that although rents are set by landlords or their representatives, Zillow has begun using its “internal systems” to detect potential violations and remove listings “with price increases that exceed the emergency limit.”
“Zillow takes the responsibility that consumers place on us to promote fair rental practices — and especially in times of crisis,” McDonald said. “If renters see potential violations, we encourage them to report the listing to Zillow and California authorities.”
In all, the Los Angeles County fires have damaged or destroyed more than 12,000 homes and other structures, creating a wave of newly homeless families in a county already facing an affordable housing crisis.
There was not just a fear of rising prices, but the general effect of high cost inflation, as relatively well-off landlords sought housing in different areas, causing already high rents to rise there and existing tenants feeling pressured to leave.
Cost increases are expected but pressures on the housing market should ease as rebuilding efforts pick up, said Christopher Thornberg, founder of Beacon Economics. After the tragic fires in Napa and Sonoma counties in 2017, rental vacancy rates fell while prices rose. But those effects were short-lived, he said.
“It disappeared after a year and then came back,” Thornberg said.
Given the extent of the devastation in LA County, however, rebuilding efforts are likely to take more than a year and the county is already struggling to provide enough new housing to meet demand.
State industry representatives and property owners say they understand the region is in the midst of a crisis and have been encouraging property owners to offer discounts to residents affected by the fire.
Housing Assn. of Greater Los Angeles has created a website for landlords to advertise short-term and long-term rentals.
Groups have been educating their members about price gouging rules and asking third-party listing services to send out alerts. Deb Carlton, executive vice president of the California Apartment Assn., said reports of widespread violence are “crazy” and called for stricter enforcement.
“The homeowners were pretty shocked,” Carlton said.
But some of them seem to think differently.
One real estate agent said that his client said “the 10% fee is not the reality of how much demand there is in the market.” According to the agent, who asked not to be identified to speak freely, the landlord instructed him to raise the rent on the Santa Monica listing beyond the allowed limit, bypassing the agent's warning about the law.
“They said they doubt he will be prosecuted.”
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