Price-gouging laws designed to protect tenants in crisis aren’t stopping some LA landlords
here.
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Los Angeles was already in a housing crisis before the wildfires consumed large parts of the county: There weren't enough homes to keep up with demand, making it one of the least affordable real estate markets in the country. Now, the word "crisis" fails to capture the situation on the ground. Thousands of people suddenly need homes. And thousands of homes are suddenly ash.
In academic terms, you might frame this as a supply-and-demand problem: fewer houses, a sudden influx of people in need, prices go up. Econ 101.
But with housing, particularly with rental markets, prices don't just "go up" on their own. Landlords decide to raise them, and there's evidence that's happening all over LA right now, despite laws designed to prevent them from price-gouging during an emergency.
See here: Real estate agents are already seeing prices of rental units climb hundreds, if not thousands, of dollars a month, sometimes as much as 20% in the span of a week, my colleague Chris Isidore reports.
Similarly, the progressive news site Popular Information reviewed Zillow rental data to find "dozens" of properties where landlords sharply increased prices since the fires began on January 7. In one case, Popular Information identified a five-bedroom home listed on December 31 for $8,750 a month. As of this week, the rent had been bumped up 125% to $19,750. In another instance, a $4,100 a month three-bedroom house shot up 93% between the end of December and January 7.
"Unfortunately, this is an all too common occurrence after a natural disaster, which is why most states have price-gouging laws on the books," said Lindsay Owens, executive director of the nonprofit Groundwork Collaborative.
California's law makes it illegal for landlords and businesses to raise prices more than 10% in a state of emergency, punishable by up to $10,000 in fines or a year in jail. The LA county sheriff said this week that law enforcement officials "are very eager to prosecute anyone who thinks they're going to take advantage of the people who have been through this tragedy."
In practice, though, these laws are difficult to enforce.
Jaclyn Senis and Laura Shockley, both displaced because of the Palisades Fire, embrace after dropping their children off at a new school in the Brentwood neighborhood of Los Angeles on Wednesday, January 15.
David Ryder/Reuters
Police officers inspect vehicles that were abandoned and destroyed on Sunset Boulevard in Palisades.
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A search-and-rescue crew inspects a mobile home park that was destroyed by the Palisades Fire.
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The remains of devastated beachfront homes are seen in Malibu, in front of homes that managed to come out unscathed.
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Members of Calvary Disaster Relief pray with a resident in Altadena, which suffered extensive damage from the Eaton Fire.
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The sun rises behind a burned car in the Santa Monica Mountains on Tuesday, January 14.
Loren Elliott/The New York Times/Redux
A Mexican search-and-rescue team walks alongside a road overlooking burned homes in Malibu.
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Firefighter Tristan Rios uses his bare hand to gauge the temperature of the ground while extinguishing hot spots in the Fernwood area of Topanga on Monday, January 13.
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This aerial photo shows homes destroyed in the Pacific Palisades neighborhood of Los Angeles.
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People sing at the Love and Unity Christian Fellowship church in Compton. A worship night of healing and restoration was held for families affected by the fires.
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Smoke from the Eaton Fire lingers above the mountains of the Angeles National Forest, north of Altadena.
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Firefighters battle the Palisades Fire in the Mandeville Canyon neighborhood of Los Angeles on Sunday, January 12.
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A utilities worker views damage in Pacific Palisades.
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A firefighter works to extinguish lingering fires in Malibu.
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Charred backpacks are seen in the rubble of Marquez Charter Elementary, which was destroyed in Pacific Palisades.
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Wildfire smoke covers downtown Los Angeles.
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People affected by the wildfires visit the LILA (Lycée International de Los Angeles) relief center for needed supplies.
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A firefighter stands guard near a home as the Palisades Fire spreads toward the Encino neighborhood of Los Angeles on Saturday, January 11.
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Kids skate at the Venice Skatepark as smoke from the Palisades Fire can be seen in the background.
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A girl sleeps on her mom's shoulder at a distribution center that was set up for people affected by the Eaton Fire.
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Fire retardant covers the backyard of a home in Mandeville Canyon.
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Firefighters pull a hose as they battle the Palisades Fire.
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The Palisades Fire burns near a house in Mandeville Canyon.
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Ella Venne searches through the remnants of her family's home in Altadena after it was destroyed by the Eaton Fire.
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Smoke rises from the Palisades Fire.
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Alec Miller from the Torrance Fire Department looks at smoke billowing from the Palisades Fire in the Brentwood area of Los Angeles.
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Firefighters watch as water is dropped on the Palisades Fire.
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A statue stands amid damage from the Palisades Fire in Malibu on Friday, January 10.
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Volunteers help unload supplies to be distributed to people in Pasadena.
Mario Anzuoni/Reuters
A burned fire extinguisher sits in the auditorium at the Eliot Arts Magnet Academy, which was destroyed by the Eaton Fire in Altadena.
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Paula Tapia hugs Katja Schmolka, who lost her home in Pacific Palisades.
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Smoke from the Palisades Fire rises over the hills near Santa Monica.
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Citrus fruit is burnt in Altadena.
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Members of the National Guard block entrances along New York Drive in Altadena.
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Vehicles charred by the Eaton Fire sit inside a dealership in Altadena.
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A firefighter surveys a hotspot in Altadena.
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A lone tree, burnt from the Kenneth Fire, remains on a hill in the West Hills section of Los Angeles on Thursday, January 9.
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A man comforts his daughter on the charred ruins of their family home in Altadena.
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The Palisades Fire is the most destructive in the history of Los Angeles County.
Maria Alejandra Cardona/Reuters
Fire crews battle the Kenneth Fire.
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A person walks amid destruction in the Pacific Palisades neighborhood.
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Desiree Johnson is embraced by her neighbor after her home was destroyed by the Eaton Fire.
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A group rescues horses in Atladena on January 8.
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Juan Munoz pours water on the fire-ravaged remains of his home in Atladena. He has lived there for more than 39 years.
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An apartment building lit by the Eaton Fire collapses in Altadena.
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California Gov. Gavin Newsom, right, tours the downtown business district of Pacific Palisades.
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Firefighters work from a deck as the Palisades Fire burns a beachfront property in Malibu.
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People embrace outside of a burning property in Altadena.
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A firefighter is seen through the window of a damaged property while battling the Eaton Fire in Altadena.
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Megan Mantia and her boyfriend, Thomas, return to Mantia's fire-damaged home after the Eaton Fire swept through Altadena.
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CNN's Anderson Cooper reports from the Eaton Fire in Altadena.
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Edgar Hernandez waits outside the Pasadena Humane Society to shelter his cat after evacuating his home in Altadena.
Zaydee Sanchez/Reuters
An Altadena home is engulfed in flames.
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A firefighter battles a house fire from a residence next door as the Palisades Fire burns in Malibu.
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Wildfire smoke covers parts of Los Angeles.
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A man walks past an Altadena business ravaged by the Eaton Fire.
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A dog barks as the Eaton Fire destroys part of Altadena.
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A senior living facility is evacuated as the Eaton Fire approaches in Altadena.
Ethan Swope/AP
Palm trees are burned from the Palisades Fire in Malibu.
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A firefighter battles the Eaton Fire in Altadena.
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Charlotte, 11, sits inside a car outside the Pasadena Humane Society. Her family planned to shelter their dog, Sid, after they left because of the Eaton Fire.
Zaydee Sanchez/Reuters
Smoke from multiple fires covers the skyline in Los Angeles.
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Fire crews begin to clear a toppled tree in Pacific Palisades.
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A woman reacts to the Eaton Fire in Altadena.
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Water is dropped over Pacific Palisades by a firefighting helicopter, on January 7.
Etienne Laurent/AP
Firefighters kick down a fence as they battle a fire approaching homes in Pasadena.
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The Palisades Fire is seen from a plane.
Mark Viniello via Reuters
A Pacific Palisades resident stands in front of a garage.
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Firefighters do not know what caused the Palisades Fire.
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Firefighters work to put out the wildfire in Pacific Palisades.
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A surfer takes off on a wave in Santa Monica as the sky is blackened from the Palisades Fire.
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A person uses clothing to partially cover their face near Pacific Palisades.
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A home burns in Pacific Palisades.
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People watch from the Santa Monica Pier as smoke grows from the Palisades Fire.
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Will Adams watches as flames from the Palisades Fire close in on his property.
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A man in a wheelchair is evacuated from Pacific Palisades.
Caroline Brehman/EPA-EFE/Shutterstock
The Palisades Fire burns a Christmas tree inside a home.
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A firefighter battles an advancing wildfire in Pacific Palisades.
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A view of the Palisades Fire from Venice.
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A woman cries as a fire advances in Pacific Palisades.
Etienne Laurent/AP
The Palisades Fire burns several miles behind the Santa Monica Pier.
Genaro Molina/Los Angeles Times/Getty Images
In pictures: Deadly wildfires in Los Angeles County
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For starters, the onus falls on renters themselves to report abuses by landlords, said Larry Gross, executive directors of the Coalition for Economic Survival, an LA-based nonprofit that advocates for tenants.
In other words, if your home just burned down and you find a rental unit where the landlord appears to be price-gouging, you can file a complaint with the attorney general or district attorney and wait for a response.
Meanwhile, you still don't have a place to live.
"When you're out on the streets and you're looking, you have no leverage whatsoever," Gross told me. "So the price-gouging law in itself is not going to protect tenants who need housing immediately. The landlord is going to go on to the other tenant who can pay a higher price."
Gross also noted a "huge loophole" in which landlords can advertise the price at no more than 10% higher, but they're still free to take a higher price if someone offers it.
"There are ways for them to wink their eye and say, ‘hey, I got these higher offers if you want to try and match that,'" Gross said.
He described the price-gouging law as a necessary but not sufficient tool in the fight to protect tenants. Ultimately, he said, city and state prosecutors and lawmakers need to move quickly.
"There haven't been any prosecutions … We saw a news conference where they threatened to do it, but threats aren't going to do tenants any good. We need action, and that's what we're still waiting for."
