What Owners Must Do if They Offer a Buyout Agreement

In Santa Monica, landlords and their agents are required to give tenants a notice of certain rights before offering any form of compensation in exchange for a tenant's agreement to voluntarily vacate a rental unit. Those rights include:  the right not to enter into a buyout agreement; the right to consult with an attorney and/or the Rent Control Board before signing the agreement; the right to an amount not less than the permanent relocation fee required by SMMC Section 4.36.040; and, the right to cancel the agreement at any time up to 30 days after all parties have signed it.

Landlords are also required to file copies of all buyout agreements with the City Clerk no sooner than 31 days, and no later than 60 days, after the agreement has been signed by all parties. If a landlord fails to follow these requirements, a tenant may cancel the buyout agreement.

Tenants are under no obligation to accept buyout offers and should realistically evaluate whether any amount offered is sufficient to make up for the loss of a controlled rental unit.