Marcia Levenson treasures her Williard neighborhood and the apartment she has rented for two decades in the area. Because she’s living with a chronic disease, Levenson’s only income is disability payments. Her Section 8 voucher allows her to stay in the neighborhood and limits her share of the rent to 30 percent of her income.
But a hot condominium market has residents in her four-plex abuzz with rumors that the property owner may convert the apartments to condos, turning “our neighborhood community into a cash register,” Levenson said, estimating that each of the units in her four-plex could be sold at $500,000.
The Berkeley City Council Tuesday amended the city’s Condominium Conversion Ordinance, adding disincentives to ways property owners can convert units to condos by evicting tenants. The vote was 8-0, with Councilmember Betty Olds absent.
The amendments are aimed at stabilizing tenancies of Section 8 voucher-holders and countering eviction without just cause in order to convert.
“There’s a whole class of tenants sitting in fear of being converted,” said Councilmember Kriss Worthington, referring to Section 8 tenants. Worthington and Councilmember Max Anderson sponsored the ordinance, which was approved by the Rent Stabilization Board in May.
If the property owner opts out of a government program such as Section 8 and then files within a year to convert the apartments to condos, he or she will have to wait five more years to convert the building under the revised condo law.
“It’s in the city’s interest to try to protect the most vulnerable tenants,” said Jay Kelekian, executive director of the Rent Stabilization Board, who told the Daily Planet that he’s heard from a number of Section 8 tenants who fear their homes will be converted to condos.
However, Michael Wilson, president of the Berkeley Property Owners Association, in a phone interview Thursday, called the fear that property owners would evict Section 8 voucher-holders “manufactured.” Property owners get market-rate rents for their Section 8 tenants and have no incentive to evict them to convert, he said.
He further pointed out that the new amendments are likely to backfire, giving property owners a reason not to rent to people holding Section 8 vouchers. Also added to the ordinance is a requirement to inform tenants in writing at least 60 days prior to filing an application to convert the units.
The new amendments provide that if a property owner forces out a tenant, without directly evicting the individual—called a constructive eviction—the owner will not be allowed to convert the building for five years. Such evictions include allowing an apartment to deteriorate so badly that there are health and safety code violations or removing the use of space, such as a backyard or a deck.
“If you push somebody out, that’s not allowed,” Kelekian said.
Worthington said the amendments are not intended to stop conversions. The current ordinance permits conversion of 100 rental units per year. (A Berkeley Property Owner Association-supported measure on the November ballot would allow conversion of 500 units per year.)
“We don’t want to stop home ownership opportunities,” Worthington said. “The amendments are a disincentive to speculators to convert.”
The current Condominium Conversion Ordinance provides protections to most tenants: they have the first option to buy their units and they have a lifetime guarantee of staying in the unit that is converted. In such cases, they rent the unit from the owner, with rent increases tied to hikes in the consumer price index.
The current ordinance also includes disincentives for property owners to quit the rental business and evict tenants in order to convert the property, and to carry out owner move-in evictions in order to convert.
Accusing the council of playing politics with the condo conversion law, “rather than solving the city’s housing problems,” Wilson argued that property owners should have been consulted.
“The City Council has made a decision about condominium conversion without consulting the people who are actually involved,” he said.