News


City must extend rent control to mobile homes

Ballot measure language requires it, attorney says

Mountain View's rent control protections must be expanded to include mobile homes, according to attorneys working for the city. The finding, announced at the city's Rental Housing Committee on Monday, Dec. 4, sets the city on track to prepare new price controls and a rent rollback by January that would impact as many as 1,100 mobile homes.

The move comes after months of complaints by mobile home residents that they were being abused by "predatory" rent increases that effectively depleted their home equity. A grass-roots campaign launched mainly by Santiago Villa residents pressed Mountain View officials to determine if mobile homes should be protected under the city's Measure V rent control law, also known as the Community Stabilization and Fair Rent Act (CSFRA).

To date, the voter-approved rent control program has applied only to apartments; however, advocates have long suggested that nothing in the measure's language would exclude mobile homes from being eligible.

The ramifications for Mountain View's six mobile home parks could be huge. Like many apartment renters, most mobile home residents in Mountain View can now expect to see a rollback of their rents to whatever they were paying in October 2015. The city could also force owners of mobile home parks to refund tenants for any higher rents they were paying before the rollback going back to December 2016, when the CSFRA took effect. Mobile home park owners will likely also be required to pay a per-unit fee to help fund the city's Rental Housing program.

The news that mobile homes must be covered under the rent control law came as a surprise for nearly everyone in the room on Monday night. A majority of rental committee members initially came out against the idea. Committee members Matthew Grunewald, Tom Means and Chairwoman Vanessa Honey each indicated they weren't comfortable bringing mobile homes under the program.

"The CSFRA isn't clear-cut on whether mobile homes should be part and parcel of this program," Honey said. "Elected officials or a ballot should make that decision."

Rent control advocates were expecting that response. They came to the meeting anticipating it would be the first step of a prolonged political battle, perhaps requiring another voter initiative.

So everyone in the room was equally startled when the committee's legal team dropped a bombshell: The Rental Housing Committee didn't have any real discretion over whether mobile homes should be included. There was no clear exemption for mobile homes in the CSFRA text, therefore the committee had to immediately include them under the regulations, said attorney Karen Tiedemann.

"The issue is: What does the CSFRA say, and what does it cover? There isn't any exemption for mobile home spaces," she said. "We would advise you to begin drafting regulations to begin implementing this for (mobile home) spaces."

The attorneys admitted it was a baffling legal situation. The CSFRA language doesn't expressly say that mobile homes should be regulated, Tiedemann explained; however, none of the measure's exemptions stipulated that mobile homes shouldn't be included. Her legal team concluded that mobile homes should be eligible for CSFRA protections if the tenant owns the structure and leases a space from a park owner. The authors of the rent control measure clearly intended this, Tiedemann said, pointing out they said as much in their ballot arguments for the November 2016 election.

Legally, it was less clear-cut whether the rent regulations should be applied to a smaller subset of mobile homes that are leased out, usually by park management, Tiedemann said. She suggested it was up to the Rental Housing Committee to decide whether to study extending rent control protection for these leased mobile homes. The committee rejected that idea.

Adding to the confusion, any future city regulation of mobile homes would also need to be compliant with the state mobile home residency law. The CSFRA and the state law have several significant conflicts over rules such as tenant relocation assistance, fee pass-throughs, notice periods for rent increases and cause for evictions. In all these conflicts, state law would take precedence.

Two mobile home park owners present at the meeting blasted the "mental gymnastics" the attorneys were taking to rationalize extending rent control to their properties. Craig Oku, owner of the Moffett Mobile Home Park, described the regulations as unfair, saying he had kept his space rents affordable, around $800 a month.

"We're treading water," Oku said. "If we had to roll back rents a couple years, then under California law we could close the park, and we really don't want to do that."

In fact, the tenants' complaints of abusive practices were all being leveled at the same mobile home park -- Santiago Villa. Residents at that North Bayshore park say the park's owner has been using aggressive tactics to push out older residents and raise space rents to around $2,200 a month. No one representing the Santiago Villa owner spoke at the meeting.

Response from the Rental Housing Committee was deeply divided. Committee member Evan Ortiz framed the expansion as appropriate for CSFRA's overarching goal to protect renters.

"A renter is a renter is a renter, and Measure V was designed to protect renters," he said. "Either we do our jobs and develop rules and regulations to respond to this, or we abdicate our role."

Yet some of his colleagues were clearly frustrated at being forced to extend rent control to a new swath of housing. Hanging over their discussion was the possible threat that a mobile home park owner would challenge the regulations in court.

"The CSFRA was not built for this," Grunewald said. "We're now going outside the bounds to take a risk that the original authors wouldn't take."

The Rental Housing Committee signaled to staff that if rent control had to be extended to mobile homes, it should be implemented with a "soft landing" to cushion the shift. The committee will hear options for how to implement the program expansion at its next meeting on Jan. 22.

This is an expanded version of the story initially posted on Dec. 5.

Comments

6 people like this
Posted by Maher
a resident of Martens-Carmelita
on Dec 5, 2017 at 3:10 pm

Well, it's about time. Over the years, my manufactured home's market price has been dented to the tune of more than $400,000 which has left only $200,000 market appreciation increase in this hot sellers' market in Silicon valley. It is a lie that homes in mobile home parks do not appreciate.

They do appreciate but a space rent increases of $10, decreases appreciation increases by $10,000. I know it sounds crazy but that is the way this mobile home park real estate market works. And the space rent increases routinely ignore the CPI (Consumer Price Index) guidelines that are suppose to be used. The rent increases are routinely higher than the CPI would permit.


12 people like this
Posted by Maher
a resident of Martens-Carmelita
on Dec 5, 2017 at 3:18 pm

PS: I pay property taxes on my home. It is considered real property by the tax assessor; it is not a vehicle. That old fashioned "vehicle" status ended in the mid-70's when manufactured home standards went into place. There are no wheels under my home. Moving my home is nearly as expensive as moving a stick built home, and the techniques are similar.


163 people like this
Posted by member
a resident of another community
on Dec 5, 2017 at 11:46 pm

As long as they're sticking it to the landlords and mobile park owners in the name of Robin Hood economics, it seems only fair now to move on to capping the price of homes. Why not roll them back a few years - no reason homeowners should make money if it's making housing unaffordable. It's all fun and games when someone else is losing the money...


13 people like this
Posted by Shame
a resident of Old Mountain View
on Dec 5, 2017 at 11:55 pm

They already capped homeowners' and landlords ongoing costs way back in the 70s, it was called Prop 13. Rich people love class warfare when they're winning


8 people like this
Posted by El
a resident of another community
on Dec 6, 2017 at 6:32 am

Here's another piece of info about Santiago Villa:

If you have an offer to sell your home, the park (ie the ever delightful owner Mr Vidovich) can void the sale

Even though the lender has determined that the buyers are financially qualified to afford the mortgage and space rent, the park can refuse the owner's ability to sell - leaving the home owner with no choice but to accept the park's lowball price.

Santiago Villa then rents out that coerced purchase for $4,000 p/mnth.

Robbing Hood indeed!


29 people like this
Posted by member
a resident of another community
on Dec 6, 2017 at 1:22 pm

That sucks, but it's his park and his rules. You must have signed something to this effect when you moved in and if you don't want to sell to him, move your home somewhere else. Of course, you probably don't want to do that because it's worth more on HIS property. It's not your home that's valuable, it's his parking space that makes it valuable. It's not a coerced purchase - if you can get more somewhere else, go for it


6 people like this
Posted by mv voice reader
a resident of Martens-Carmelita
on Dec 6, 2017 at 4:19 pm

The mobile home parks listed in this article have 3 classes of renters:

1) those who own their unit and lease the land ... their rents have been going up annually at a modest rate

2) those who just bought a new unit and are leasing the land at the new, very high, market rate

3) those that rent the unit from the park owner (who owns the land) ... it is these tenants who most closely align with a typical apartment renter ... they own nothing, and every year have been experiencing exorbitant rent increases exactly like apartment renters which the rent control ordinance was designed to protect ...

if any mobile home class of renter should be covered by these rent control protections, it is the renters in #3 ... they are identical to apartment dwellers ... they are effectively renting a free-standing apartment from the owner of the mobile home park just like an apartment dweller rents a unit from the landlord ... the only difference is what the unit looks like


Like this comment
Posted by The Business Man
a resident of Another Mountain View Neighborhood
on Dec 6, 2017 at 11:04 pm

The Business Man is a registered user.

There are 2 important issues that will need to be done now.

The first is that mobile park land owners are now required to pay a $160.00 fee per mobile home land site, given they are now categorically a “landlord”

Second, that the mobile home owner is required to be paid back any overpaid land rent based on the initial occupancy. Thus those residing since October, 2015 are entitled to the rent-rollback as of December 23rd, 2016 up to today.

It is too bad that this was not addressed at the beginning, however, that problem was caused by the confusion and inability of the City to “walk and chew gum” at the same time.


11 people like this
Posted by Bob
a resident of Monta Loma
on Dec 8, 2017 at 8:20 am

Bob is a registered user.

This is why I sold my apartment buildings and got out of there. These people can justify anything when it comes to stealing other people's money, especially a landlord's.

My advice to the Landlord's is to do what I did and sell your property to developers and let them tear it all down. Then the renters can move into new 1.5 million dollar homes for $6k/month.

Your property is worth as much torn down as it was before rent control, you deserve it..get it now by redeveloping in this hot real estate market that has no inventory for buyers.


Like this comment
Posted by The Business Man
a resident of Another Mountain View Neighborhood
on Dec 8, 2017 at 10:12 am

The Business Man is a registered user.

In response to Bob you said:

“This is why I sold my apartment buildings and got out of there. These people can justify anything when it comes to stealing other people's money, especially a landlord's.”

Any “investment” does not have a guaranty of profits. Where this occurs, you cannot claim that anyone is “stealing” anything. These people new the risk, and chose to gamble. So this statement simply makes no sense. You said:

“My advice to the Landlord's is to do what I did and sell your property to developers and let them tear it all down. Then the renters can move into new 1.5 million dollar homes for $6k/month.”

Of course you can decide to to this, but it will require that the plans be approved by the City. But since the new State laws require the City to develop projects in compliance with the needs of affordable housing, the city can be financially damaged by non-compliance. This would seem to make it very difficult for an apartment building that say has up to 10 units be replaced by maybe 2 single occupancy homes. This may not get off the ground. You also said:

“Your property is worth as much torn down as it was before rent control, you deserve it..get it now by redeveloping in this hot real estate market that has no inventory for buyers.”

There is a significant risk of Costa Hawkins being repealed. If it does succeed, than all apartments will be rent controlled, even the new ones being “built”. What you are doing is giving advice that is likely to explode in the followers face. But since you are anonymous, not a financial adviser, and you have a constitutional right to express your point of view, you will not be liable for the losses that are likely to occur. I would simply hope the readers are very careful regarding their choice of action.


8 people like this
Posted by Bob
a resident of Monta Loma
on Dec 9, 2017 at 11:10 am

Bob is a registered user.

Business man,

You have no experience in real estate like I do. You're a renter and that is the extent of your experience.

I am an investor and have invested in multiple markets in the bay area and outside the state. I have owned and still own a diversity of types of real estate holdings. Apartments, Condos, townhouses, Houses, Commercial retail single tenant and multiple tenant shopping centers. I've owned alone and have owned in partnerships. My experience has spanned 5 decades if you count my parents mentoring in real estate.

In my experience as an investor and working with other investors, have concluded that rent controlled properties should be disposed of if one seeks higher returns.
This is not a theory but a conclusion.

I did well in Mountain View and new when to exit as I did. My investments there increased in value at a better than bay area market rate. My last 5 years saw a 100% increase in valuations. Rent control is the reason I sold to a developer and have moved my money into Million $ properties in the east bay.
I did great and I want to see other investors do well. My advice is for others to explore, that's it.


3 people like this
Posted by Repeal Rent Control
a resident of North Whisman
10 hours ago

Repeal Rent Control is a registered user.

Ah, rent control. Here we have Exhibit A's shining example of a shoddy legal Article now memorialized as a Mt. View Charter Amendment, drafted by incompetent Stanford Law School undergraduates under the watchful eye of Juliet Brodie . . . all designed to ensure conflict, confusion and lack of clarity with its intentional ambiguity and defects. Why? To promulgate the inevitable legal fees that ensue while the entire circle-jerk boondoggle is sorted out in court.

Enjoy the fight, Mt. View. Like Bob, I'm on that glorious bus out of town. I hope every landlord in Mt. View pulls up stakes, sells to a home building developer, and the entire rental market disappears. Only then will Mt. View get what it deserves.


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