So what is AB1309 (Calderon) and what will it mean to owners of mobilehomes if it passes and becomes law in 2008?
What is AB1309? In simple terms, Assembly Bill AB1309 is about VACANCY DECONTROL.
Mobilehome Rent Stabilization: there are approximately 100 local jurisdictions with some form of mobilehome park rent stabilization in California. Some of these ordinances have a vacancy control or partial control mechanism, meaning that the rent cannot be increased or can only be adjusted marginally upon a vacancy in a park space (when a home is sold and title transferred to another party). This bill would pre-empt local mobilehome vacancy control stabilization ordinances.
Remember the park owners group called Western Manufactured Communities Association (the WMA for short)? Well the WMA sponsored AB1309 last year and the California Association of Realtors, the California Chamber of Commerce and the California Mobilehome Parkowners Alliance supported it. It became a two year . Now the legislature will reconsider it, beginning as soon as January 7, 2008. What will it mean to owners of mobilehomes in rent stabilized areas?In one, simple word: DISASTER! Why? Remember our rule of thumb? For every $10 rent increase, the equity in our homes decreases $1000. AB1309 doesn’t effect the equity of our home as long as we live there. But it has disastrous consequences when we try to sell. You may ask “Why hasn’t CoMO-CAL written about this before? Why haven’t we been alerted?”
In fact, we began writing about it in April 2007. It was on the front page of our June 2007 issue: “AB 1309 – DISTURBING NEWS FROM SACRAMENTO” At that time we wrote:
We feel if this does become law, it will have a devastating effect on all owners of mobilehomes. For example, we have a Rent Stabilization Ordinance here in Los Angeles which allows parks to increase rents upon sale by 10%. This means if your rent is $500 and you sell, your buyer’s rent increases $50 to $550. A $50 rent increase translates into an equity loss (your home is worth less) of about $5,000. If AB1309 were to become law, there would be NO CAP for new tenants. Their rent could easily DOUBLE. Based on our example, their space rent could jump to $1000, a $500 rent increase! So what happens to your equity and your sale? YOUR HOME IS WORTH $50,000 LESS! Not the $5,000 under the present law. YOU LOSE $45,000 more! Of course this is an estimate of the effect of AB1309, but let’s not wait to find out when it becomes law.
Remember this applies to areas presently having rent control, with an ordinance that caps rent increases upon sale. In all other cases, park owners can already increase your rent to any level. You are already at their mercy. So what can you do to stop BA1309? Write your legislator telling him what a disastrous bill this is for owners of mobilehomes. Indicate you personally would lose thousands of dollars should it pass and become law. Get your friends and neighbors organized and suggest they follow your lead.That’s what it takes. Organization and Effort. CoMO-CAL is here to support your efforts, but we can’t do it for you.Remember, this is not the only challenge to rent control. The other is the Jarvis Initiative. We have written about it many times in 2007. It will probably be on the June 2008 ballot. Late in January 2008 it should be assigned an initiative number. We will follow up on developments in the February issue of THE VOICE.