Muti-unit building on 1st and Fickett offered for sale for $1.6 million. Photo by Antonio Mejías-Rentas
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By Daniela Barranco
Boyle Heights Beat
There are plenty of reasons people want to live in Los Angeles, but high rents are making it more and more difficult to do so. If you are a low wage earner, it’s becoming even more challenging.
In Los Angeles County, renters need to earn four times the minimum wage –or $48 an hour– to afford the median asking rent of $2,499. This, according to a May report by the California Housing Partnership Corporation. Since 2000, inflation-adjusted household income has decreased by three percent, while rents have soared by 32 percent.
In some cases, the county’s lowest-income renters, like those living in Boyle Heights, are now forced to spend 70 percent of their income on rent, according to the same report.
And the situation is getting more worrisome, according to Isela Gracián, president of the East L.A. Housing Corporation. Boyle Heights’ proximity to downtown Los Angeles lures wealthier Angelenos, which helps drive prices up. “There’s an interest from people that wouldn’t have considered buying or renting in Boyle Heights before,” says Gracián.
With high rental prices and increased competition come fears of displacement and eviction. While community organizations and the city are working to help keep residents in the area, many can no longer afford to stay.
Rental price data from Trulia shows that the median rental price in Boyle Heights in June was $2,150, up from $1,625 one year before, a 25 percent increase. In Los Angeles as a whole, median prices rose from $3,400 to $4,500, a 26 percent increase, indicating that Boyle Heights, while still less expensive, is experiencing nearly the same rate of increase as the rest of the city. Compton, on the other hand, experienced a 12 percent drop in median rental prices over the past year, from $2,050 to $1,795, Trulia reports.
In Boyle Heights, 75 percent of residents are renters, and nearly 88 percent are protected under the Rent Stabilization Ordinance (RSO), or rent control. Still, many residents are unaware of their rights. And those who live in buildings constructed after 1978 are not protected by the city’s rent control ordinance.
In a new door-to-door “Know Your Rights” campaign, Councilmember Jose Huízar is working with local nonprofits, such as Unión de Vecinos, a tenants rights group. “We want to make sure the majority of our Boyle Heights’ families whose residences are protected under rent control law know that they have rights that protect them from unwarranted evictions and rent hikes,” Huízar told Boyle Heights Beat.
Organizers: landlord pressure tactics
Elizabeth Blaney, co-executive director and co-founder of Unión de Vecinos, says it’s becoming more common across the city for landlords to try and evict long time residents and then sell buildings to investors.
“It’s important that tenants know they do not have to go because they have a new landlord,” says Blaney. “If you live in a rent control building, you do not have to leave and you do have protection for any harassment.”
Properties that are under rent control are limited to rent increases of three percent each year for existing tenants. If a tenant is evicted or moves out, a landlord can raise the rent, which community organizers believe leads some landlords to pressure tenants to leave. Gracián says her organization has heard of landlords who threatened to call immigration services if an undocumented residents refuses to move.
Under rent control, evictions fit into one of two categories: tenant-at-fault and not-at-fault. At- fault includes failure to pay rent, violation of rental agreement, creating a nuisance or damage to unit, using rental for illegal purposes and others. Not-at-fault reasons include a property owner moving into the unit, demolition or permanent removal from the rental market. In those instances, property owners are required to pay renters for relocation.
Landlords sometimes offer large sums of money to get tenants to volunteer to move so they can charge higher rents to a new tenant, a practice nicknamed “keys for cash.” This is not an illegal practice, however, and one which Daniel Faller, president of the Apartment Owners Association of California, calls a “win-win” situation.
Faller says in his experience tenants engage more in harassment than landlords. He says many people don’t realize that providing housing is a business. He says city officials have created the housing shortage by “punishing those who provide housing [by] forcing them to provide housing for less than fair market value.”
While those living in apartments exempt from rent control don’t have the same rights or recourses those who do, organizing can sometimes help.
Last year, María Romero and her neighbors received a 60-day notice for a $400 a month increase after the owner sold the Michigan Heights apartment building where she lived. The landlord could legally raise the rent without any limits because the building was built after 1978 and not covered by rent control.
“What scares me the most is when one sees that many people do not have a place to live and sleep in their cars. I didn’t want to go through that with my children” says Romero.
Before, tenants faced with a big rent increase could find a new place within 60 days, says Blaney, but “now tenants are seeing they can’t afford anything else in the market that doesn’t take them super far away from their schools and work.”
With the help of Unión de Vecinos, the Michigan Heights tenants protested the rent increase. The new landlord, Bascom Group, was willing to negotiate and compromised with a rent increase of eight percent instead of the 34 percent initially requested. The landlord also agreed to building improvements.
Boyle Heights’ $1.6 million apartment building
A property currently for sale at First and Fickett streets has many in the neighborhood worrying about gentrification. An eight-bedroom Victorian house, built in 1934, has been divided into six apartments and is listed at 1.6 million. While it’s been extensively remodeled, neighbors are surprised by the price tag. The same property sold just two years ago for $550,000.
The listing agent, Echo Park realtor Ken Shapiro, from Silverwood Properties, boasts about the property’s money-making potential on his website: “All of these units have high ceilings and period features. All of these units (except one of the one-beds, which is the only one with a low-rent tenant and will not be delivered vacant) have been fully renovated inside and out by people well schooled in how to appeal to the Millennials who are invading Boyle Heights in droves.”
Buying tougher, too
The median price for a two-bedroom home in Boyle Heights in May was $445,750, up from $153,000 five years ago, according to Trulia. Meanwhile, during the same period, the price of a two-bedroom home in Los Angeles as a whole rose to $660,000 from $336,000.
Lydia Ávila, 33, was born and raised in Boyle Heights and went to Occidental College. She rented and saved her money, but when it came to buying a place of her own, it took nearly five years. While searching for a home, she often lost out to higher bidders. Realtors often told her the neighborhood was changing.
“There were a lot of people bidding on the same homes that I was bidding on. Whether they were in good condition or not, there were still tons of people. One house had 18 offers on it, mostly from investors,” she says.
Ávila persisted because of her desire to stay in her community. She says she loves Boyle Heights, and and feels threatened by investors coming in from downtown.
“I want my kids to be proud of who they are and where they came from, and the best way to do it is living in their own neighborhood,” Ávila says.
How Rent Control Works in Los Angeles:
- Rent control began in 1979 to limit rental increases.
- Rents in buildings built before October 1978 that include more than one unit are limited to three percent increases per year.
- Once a tenant leaves a rental unit, landlords may raise rents for new tenants.
- In rent-controlled units, rent can only be changed once a year.
- Landlords must pay relocation fees to tenants in rent-controlled units if their lease is ended through “no fault” of the tenants, such as if the building is going to be demolished, converted to a condominium or occupied by a property owner or manager or one of their relatives.
Daniela Barranco graduated from Francisco Bravo Medical Magnet High School and will be attending Cal State Los Angeles this fall. She enjoys spending time with family, listening to music and learning new things about Boyle Heights.
Ernesto Orozco is finishing his last year of high school and hopes to attend art school and study photography. He enjoys video production and exploring the city.