The Real Estate industry has recently been trying to downplay the effect of the Ellis Act in the media. They are worried about talk of reforming of the Ellis Act. They minimize the damage of evictions by ignoring the numbers of units per building and not calculating how many people live in these apartments. We would like to take the opportunity to set the record straight.
The number of evictions in 2013 has surpassed evictions in 2006, the height of the real estate bubble. Total no-fault evictions are up 17% compared to 2006.
More significantly, there has been a 115% increase in total evictions since last year. The rate of increase over the past year is especially troubling and the graph shows a sharp increase. Ellis Act use has increased by 175% compared to the year before. The Rent Board does not collect information on how many bedrooms or how many people reside in a unit.
If each evicted unit here represents between 1 and 5 people, we estimate between 716 and 3580 residents were evicted within the last year.
It is also important to note that evictions prior to 2008 were different than those of today due to Peskin controls on condo conversions of Ellised and OMI'd buildings. There were fewer Ellis bluffs and threats before 2008 as the Peskin controls actually did reduce the number of no fault evictions, along with the market crash. These controls drove more evictions underground, in the forms of buy outs and harassment particularly. Thus data comparisons between pre-2008 and the present are misleading.
The relevant findings are made not in comparing 2013 to 2006 but in comparing 2013 to 2012.
Demolitions have gone from 45 in 2006 to 134 in 2013, a 197% increase. Each Demolition is a loss of a rent controlled unit. The 2013 spike is mostly because of one building, 1049 Market Street, a six-story, 75-unit building between Sixth and Seventh streets. Aside from that building, the trend of demolition evictions is generally increasing consistently with previous trends.
Our data suggests an overall increase in evictions with the greatest threat being Ellis. Our data supports our analysis that institutional speculators and investment companies are driving the market. Investment companies and speculators are not generally utilizing OMI evictions.
*A note about data: These numbers reflect official petitions filed with the Rent Board. We have eliminated duplicate filings at the same address so our numbers different than Rent Board tallies.
**The high number of Owner Move Ins (OMI) that you see in in the past reflect a misuse of the law that allowed owners to evict to occupy the building. Legislation was passed in 1998 that limited how the owner could use an OMI eviction. Only one unit in a building is allowed and the owner must reside there for three years as a principal residence. Seniors and disabled renters are protected from eviction if viable units are available instead. Families with school age children are allowed to finish the school year. Relocation costs must be paid and evictions must be filed with the Rent Board.
As you can see with the drop of OMIs in 2000 after the legislation took effect, the OMI was used as a speculative weapon.