Gov. Newsom issues executive order extending price-gouging protections for LA wildfire survivors
Just as price-gouging limits for LA wildfire survivors were set to expire, Gov. Gavin Newsom announced an executive order Friday extending these protections for these tenants and homeowners as many remain without permanent housing.
Newsom had announced a state of emergency for the deadly Palisades and Eaton Fires when they first broke out in early January, issuing the order for them and a series of other blazes in Los Angeles and Ventura counties around the same time. Tens of thousands of people had fled their homes as entire neighborhoods were burned to the ground. On Jan. 16, as many remain evacuated, Newsom issued an executive order extending protections against price-gouging in the region through March 8.
When a state of emergency is declared, prices increases of more than 10% from before the emergency are not permitted under California — a measure intended to protect against exploitative price hikes on resources in short supply. In this case, the state has capped prices for hotels, motels and rental housing to no more than 10% from before the emergency was declared Jan. 7.
With these protections for tenants and homeowners set to expire March 8, or Saturday, Newsom announced Friday that they would be extended until July 1, 2025. Since January's emergency declaration, California Attorney General Rob Bonta has already announced charges against a number of real estate agents accused of exploitative price hikes on rental listings.
In Glendale, a family evacuated in the Eaton Fire faced a rental rate that was 50% more than what it was listed for before the January fires, Bonta's office said, announcing the real estate agent behind the listing was being charged with price-gouging. At the time, just three weeks after the fires started, Bonta had already sent 650 warning letters to businesses accused of price-gouging.
"In the face of natural disaster, we should be coming together to help our neighbors, not attempting to profit off of their pain," Bonta said in a statement announcing the charge. "May this announcement serve as a stern warning to those who would seek to further victimize people who have lost everything in the face of Southern California's wildfires: We won't stop until the price gouging does."
Several news outlets have reported on particularly drastic price hikes across LA County. As the wildfires continued to rapidly spread, on Jan. 11, LAist reported on a Bel Air listing for $29,500 per month. In September, that same house was listed for $15,900 per month — marking an increase of about 86%. At the time, thousands were evacuated from their homes not far from that area of west Los Angeles, most from the affluent coastal community of Pacific Palisades which was left devastated by the Palisades Fire.
In a statement, Newsom's office said the order does hold exemptions for "large homes in zip codes with high fair market values which have not recently been on the rental market," which his office said is intended to help ensure these listings are available for rent during recovery efforts." Newly constructed housing is also among the exemptions to the governor's latest order, something his office said is intended to enable flexibility with pricing for these new buildings, which may be facing higher financing costs.
The new executive order also extends a suspension of laws that classify people staying inside hotels, motels and other short-term housing as official tenants after 30 days. His office said this acts as another protection for those needing temporary housing, giving them more time to find other places to stay by offering landlords an incentive to keep renting to them.
Newsom's office said the order also seeks to help wildfire survivors struggling with homelessness by prioritizing them on waiting lists for state-funded housing.