Introduction

The LA City Council has voted on new "renoviction" rules that fundamentally change how multifamily property owners can manage renovations. Understanding these Los Angeles multifamily renoviction rules 2024 is critical for anyone managing rental properties in the city. These new protections offer a glimpse into what the rental landscape might look like if Proposition 33 passes. With tenant protections growing stronger, property owners are facing an increasingly challenging environment when it comes to managing and renovating their investments.

Here's what you need to know about the new rules and how they impact your multifamily portfolio.

What Are the New Los Angeles Multifamily Renoviction Rules?

The recent vote by the LA City Council introduces significant changes to how landlords can approach renovations on occupied rental units. These Los Angeles multifamily renoviction rules 2024 introduce additional requirements, particularly for rent-controlled properties, while aiming to curb tenant displacement due to remodeling.

1. Eviction Only If Unit Is Uninhabitable

   Landlords are now restricted from evicting tenants for substantial remodels unless the unit is deemed "uninhabitable." This is a major shift. If the tenant can continue to safely live in the unit during renovations, an eviction is not permitted. This means property owners must find ways to conduct renovations while tenants remain in place, or accept that evictions for remodeling purposes are largely off the table.

2. Permit and Inspection Requirements

   Property owners must now secure specific permits and meet inspection requirements to verify the need for extensive remodeling. The law aims to prevent situations where evictions are justified for minor or cosmetic updates. Only essential health and safety upgrades qualify under these new rules. This adds a layer of bureaucracy and scrutiny to the renovation process.

3. Tenant Right to Return

   When an eviction is approved for substantial remodeling, tenants have the right to return to their unit once renovations are complete at the same rental rate they previously paid. This safeguard prevents landlords from using remodels to circumvent rent control laws by moving new tenants in at market rate. For multifamily owners, this means you cannot use renovations as a strategy to reset rents to market levels.

Who Is Affected by These Renoviction Rules?

The protections primarily apply to tenants in rent-controlled units under the Rent Stabilization Ordinance (RSO) and those covered by AB-1482, the Tenant Protection Act of 2019. If you own multifamily properties subject to RSO or AB-1482, these rules directly impact your renovation strategy.

For landlords of non-RSO units or those not under the Tenant Protection Act, this policy does not impact the flexibility you have in property improvements. However, it does set a precedent. Other cities are watching LA's approach, and these rules may expand to cover more property types in the future.

Stakeholder Reactions to the New Renoviction Rules

The response to these new Los Angeles multifamily renoviction rules 2024 has been divided along predictable lines.

The Apartment Association of Greater Los Angeles (AAGLA) has expressed significant concerns. In a statement, AAGLA noted, "By making it more difficult to evict for substantial remodels, the City is effectively discouraging much-needed property improvements." Property owners now face more scrutiny and hurdles, which could slow down the process of enhancing property value and ensuring tenant safety. For multifamily investors, this means longer timelines and higher costs for renovation projects.

Tenant advocacy groups, meanwhile, have voiced strong support for the new measures. They argue these protections prevent tenants from being unfairly evicted under the guise of remodeling. Councilmember Nithya Raman, a vocal supporter of tenant rights, stated, "This vote sends a clear message that LA will not tolerate eviction tactics that exploit housing loopholes. It's time to put an end to the misuse of the remodeling clause as a method to try and evict people."

How These Rules Impact Your Multifamily Strategy

For multifamily property owners, the new renoviction rules require a fundamental shift in how you approach property improvements. You can no longer rely on renovations as a pathway to reset rents or remove long-term tenants.

Instead, consider these strategies:

1. Plan renovations that can be completed with tenants in place. This may require phased approaches or temporary relocation agreements that comply with the new rules.

2. Focus on essential health and safety upgrades that clearly meet the "uninhabitable" threshold if you need to evict for renovations.

3. Budget for longer timelines and additional permitting costs when planning major renovations.

4. Understand that any tenant displaced for legitimate renovations has the right to return at their previous rental rate. Factor this into your financial projections.

The Bottom Line

The new Los Angeles multifamily renoviction rules 2024 represent a significant shift in how property owners can manage renovations. With restrictions on evictions, new permitting requirements, and tenant rights to return at previous rental rates, the landscape has fundamentally changed. These rules apply primarily to RSO and AB-1482 properties, but they set a precedent for broader protections.

For multifamily property owners, the time to understand these rules is now. The Kenny Stevens Team stays current on LA's evolving rental regulations and how they impact your multifamily investments. Contact us to discuss how these new renoviction rules affect your property strategy and what steps you should take to ensure compliance.