A lot of the people who contact me are tenants in or around the Bay Area, and are tenants whose landlord is offering them some kind of buy-out. These people often want to check in about what’s ‘reasonable’ or ‘fair’ in their circumstances, and having done a bunch of these, I thought a blog on evaluating buy-outs would be helpful.
First, everyone’s situation is a little different. The best way to start is to ask why your landlord wants you out. To do construction? To increase the rent by getting a new tenant? The answer to this question will determine which rules your landlord has to obey, and changes your bargaining position considerably.
Second, remember that this is a business transaction. Tenants often get fixated on the notion that the landlord owns the property and can get it back, which honestly is only kind of true. In Berkeley, for example, Owner Move-In evictions are very hard to do right, and the liability from messing them up is immense. In SF, a buy-out negotiated before a tenant saw the Rent Board’s information form on buy-outs is completely voidable by the tenant. The place where you live might be owned by someone else, but it’s your home, and the law says that you can’t be easily tossed out.
Last, location, location, location. In very rough terms, around the East Bay, buy-outs go from most to least expensive in this order: SF, Berkeley, Oakland, and, surprisingly, Richmond. However, the last tenant to negotiate a buy-out when the owner is planning renovations has a much stronger hand than the first, and of course the real estate market here changes quickly.
So, one of the benefits of getting a lawyer to help you with this is that you won’t have to try to learn all the rules and comparisons yourself. We have taken these cases on contingency at times, meaning that you don’t pay up front, but we get a percentage of the final settlement. We can and have gotten people tens of thousands of dollars more than they expected, and I like to think we’ve often managed to avoid long, painful, and expensive legal battles by pushing hard, early, for a settlement.
If you’re a tenant being offered a buy-out, seriously consider sending us some info for a quote, and see how much we can help you.