Rental Housing Board to Review Tenant Buyout Rules After 36 Deals Totaling $847,838

Landlords in Pasadena have paid tenants a combined $847,838 to voluntarily give up their units through 36 buyout agreements filed with the city from January 2025 through May of this year — an average of $23,555 per agreement — and the Pasadena Rental Housing Board is scheduled Thursday to consider whether the process needs new rules.

The Rent Stabilization Department’s report on the tenant buyout process, submitted by Executive Director Helen Morales and prepared by Program Coordinator III Stanko Zovko, is for information only. Staff are asking the Board to receive it and consider whether to provide direction, including whether to write regulations governing buyouts. The City Charter permits but does not require the Board to adopt such regulations, and staff suggest the Board may find none are needed given the Charter’s detailed provisions and the effectiveness of the current process.

Article XVIII of the City Charter recognizes a mutual buyout between a landlord and a tenant as a valid way to terminate a tenancy, and Section 1810 created the Tenant Buyout Notification Program to regulate, monitor and enforce voluntary vacancies and promote fairness during negotiations. The program requires that tenants be informed of their rights before signing any agreement, and the notice form tenants receive cautions that rents for new units in the area may be significantly higher than what they now pay, especially for those who have lived in a unit a long time, and advises checking rents for comparable units before entering into an agreement.

Before making any offer, a landlord must give tenants a notice of their buyout rights — written in the tenant’s primary language on a form prepared by the department, and dated and signed by both parties. The landlord must file the signed notice and the buyout agreement with the Board within 60 days of the agreement’s execution; copies can be sent to the department at rentstabilization@cityofpasadena.net.

Every agreement must be written in the tenant’s primary language and state, in at least 12-point bold type above the tenant’s signature line, that the tenant may cancel any time up to 45 days after all parties have signed without obligation or penalty. It must advise tenants of their right not to enter into an agreement, to consult an attorney or the Board before signing, and to cancel within the 45-day window, and it must be signed and dated by both sides with a copy given to the tenant.

Tenants may cancel for any reason within 45 days of execution without financial obligation or penalty. If the notice or agreement does not conform to the Charter or Board regulations, the tenant may cancel through the applicable statute of limitations period, and a tenant may bring a private right of action against a landlord who violates the section to recover damages and a $1,000 penalty.

The city is not a party to buyout negotiations, which are conducted solely between landlord and tenant, and enforcement of an agreement’s terms is a civil matter between them. The department informs both parties of the procedural requirements, the tenant’s rescission rights and the alternative tenancy-termination options available under the Charter, including the relocation assistance owed to tenants in a no-fault eviction. Staff collect and maintain the filed agreements.

The notice form, revised in August, spells out the relocation assistance schedule in effect since October 2025 so tenants can weigh a buyout offer against what they would be owed in a no-fault eviction. Base payments range from $6,720 for an efficiency unit with a tenancy of three years or less to $22,075 for a unit with four or more bedrooms and a tenancy of 10 years or more, plus a moving expense allowance of $1,620 for an eligible tenant household or $4,890 for a special circumstances household. Households with a member who is 60 or older, disabled, terminally ill or a legally dependent minor child qualify as special circumstances households and receive an additional payment of $6,720 to $13,245 depending on unit size.

The notice also advises tenants that they may be waiving important rights by entering a buyout, that it is unlawful for an owner to retaliate against a tenant who declines to negotiate, and that a violation of the buyout section may be asserted as an affirmative defense in an unlawful detainer action.

The report carries no fiscal impact.

The Pasadena Rental Housing Board is scheduled to meet at 6 p.m. on Thursday, Sept. 3, in the Council Chamber, Pasadena City Hall, 100 North Garfield Avenue, Room S249, in Pasadena. For more information call (626) 744-4124 or visit https://www.cityofpasadena.net/commissions/agendas/.