A San Francisco couple received a record court settlement of nearly half a million dollars for agreeing to leave their luxury apartment of thirty years.
The $475,000 voluntary buyout was paid to a couple in their 60s with teenage children who were paying $12,500 a month for two apartments consisting of seven bedrooms and eight baths with expansive views of the bay, Golden Gate Bridge, and nearby Presidio park.
The settlement is considered the largest in the city’s history, showing what some landlords must go through to evict long-term tenants in a city with some of the strictest rent controls in the nation coupled with soaring market rents.
San Francisco’s tenant laws and rent control ordinances go back to 1979 to alleviate the city’s housing crisis. Landlords can only raise the rent by 1% a year on some properties, and they cannot evict tenants without just cause, such as nonpayment of rent, and they must also pay tenants to vacate
The couple was represented by lawyer, Steven Adair MacDonald.
“More than 300 tenant buyouts were filed with the San Francisco Rent Board in 2020. MacDonald said average buyouts are $50,000, and they are growing given the difference between market rent and length of tenant residency.”
“Landlord attorneys think it’s an outrage, and on the tenant side, everybody’s excited, they think it’s great,” he said. But MacDonald thinks the landlord is the winner, as he will be able to rent the apartment for $25,000 a month and recoup the buyout amount in just over three years.
“After that, it will be gravy, so it’s a great investment,” said MacDonald.
Moe Bedard is the founder and lead mortgage analyst for LoanSafe.org. Since 2007, LoanSafe has helped over 2 million consumers with solutions to their mortgage problems and has been featured in the New York Times, LA Times, Fox Business, and many other media publications.