How do Good Cause Eviction laws differ between New York and California? Erica Buckley and Ashley Klein speak about the differences in the New York and California laws, and how they affect landlords and property owners in each state. They also explore the historical context, market impacts, and potential compliance challenges associated with these regulations.
Historical Context and Implementation
In California, Good Cause Eviction laws emerged organically in the late 1970s and early 1980s, starting with cities like Santa Monica and San Francisco. These laws were integrated into local rent control regulations from the beginning. By 2019, California had enacted a statewide Good Cause Eviction law, with some exemptions for single-family homes, condominiums, and newer constructions. However, local jurisdictions with stricter ordinances can override the state law.
In contrast, the New York state Good Cause Eviction statute is mandatory for New York City, while other cities must opt-in. Local municipalities have some discretion, making the framework slightly different from California’s more uniform approach.
Impact on Tenants and Housing Market
Ashley pointed out that while these regulations aim to protect tenants, they can often increase housing costs. Rent control can inflate property values, benefiting investors but making it harder for low-income individuals to enter the market. Some long-term tenants who are displaced due to no-fault evictions (such as owner-move-in evictions or units being removed from the rental market) and pay below-market rates often face challenges in finding affordable housing. As a result, they may have to relocate outside of the city or state. These challenges stress the need to streamline building processes and allow new development. Increased supply could alleviate many housing issues without the need for stringent regulations.
Future Challenges and Legal Implications
In New York, the notice requirement for Good Cause Eviction will take effect on August 18, 2024. There is concern about a potential wave of Good Cause Eviction litigation as tenants and landlords navigate New York’s new law. Ashley highlighted that New York’s rent law includes provisions for attorneys’ fees, which could incentivize tenant-side lawsuits.
Additionally, the conversation touched on the possibility of increased tenant buyouts. In California, buyout regulations have evolved to manage these transactions, and similar measures might be introduced in New York on a state level.
Enforcement and Oversight
One significant difference between the two states is the enforcement mechanism. In California, local jurisdictions initially enforced Good Cause, with the state law providing a private right of action for lawsuits. New York, however, lacks a designated agency to oversee the law. This gap might be filled by local municipalities or the New York Attorney General, who has broad powers to address wrongdoing under the Executive Law.
Conclusion
Our discussion underscored the complexities of Good Cause and their varied impacts on the housing market. While these regulations aim to protect tenants, they pose challenges for landlords and property owners. The key to a balanced approach may lie in increasing housing supply and streamlining development processes, ensuring tenants and landlords can navigate the market effectively.
Nixon Peabody State Attorneys General, Commercial and Real Estate Litigation, and Cooperatives & Condominiums teams are ready to advise property owners and villages, towns, or cities outside of New York City on Good Cause. For more information on the content of this alert, don't hesitate to get in touch with Erica, Ashley, or your Nixon Peabody attorney.