Unraveling the Legal Maze: Understanding the Implications of Renting Illegal Units in Rent-Controlled Jurisdictions of California

Illegal units are dwellings that do not have the required Certificate of Occupancy and are often referred to as unwarranted, non-conforming, or unpermitted units.
In rent-controlled jurisdictions like San Francisco, Berkeley, and Oakland, illegal units are covered under local rent control ordinances, providing tenants with special protections such as limitations on rent increases and eviction without good cause.
Signs that a unit may be illegal include it being an in-law apartment, backyard cottage, garage apartment, granny unit, basement, or attic. Other indicators can be the absence of a separate address, gas and electric meter, mailbox, low ceilings, ungrounded electrical outlets, or rooms lacking windows.
Lease agreements for illegal, unpermitted, or unwarranted units are generally considered unlawful and void. However, tenants can still enforce the contract and sue their landlord for damages based on the principle of protecting a class of people from illegal activities.
Landlords cannot collect or request rent for an unpermitted unit, but tenants may still face attempted eviction if the owner is cited for having an illegal unit. Just-cause reasons for eviction in such cases may include substantial repairs to bring the unit up to code or demolition.
The San Francisco Unit Legalization Program allows owners to apply for the legalization of one unit per building lot without fines or citations. Similar programs have been introduced in other Bay Area cities like Oakland and Berkeley to encourage the legalization of unpermitted units.
While obtaining a demolition permit is difficult, demolition can be a just cause for eviction in most local rent ordinances. However, owners must follow specific requirements, including providing relocation benefits to tenants and demonstrating good faith in the eviction process.

Frequently Asked Questions

Q- What qualifies as an illegal unit in California?
👉 An illegal unit in California refers to a dwelling that lacks the necessary Certificate of Occupancy. These units are often called unwarranted, non-conforming, or unpermitted.
Q- Which cities in California have rent-controlled jurisdictions?
👉 Cities like San Francisco, Berkeley, and Oakland in California have rent-controlled jurisdictions.
Q- What are the common indicators that a rental unit might be illegal?
👉 Signs of an illegal unit may include it being a garage apartment, in-law apartment, backyard cottage, basement, or attic. Other indicators could be the absence of a separate address, gas and electric meter, mailbox, rooms lacking windows, or ungrounded electrical outlets.
Q- Are unlawful unit leases permitted in California?
👉 In California, unpermitted, unjustified, or illegal lease agreements are invalid. Tenants may sue the landlord for damages and enforce the contract..
Q- What protections are provided to tenants living in illegal units?
👉 In rent-controlled jurisdictions, illegal units fall under local rent control ordinances. These offer tenants special protections such as limitations on rent increases and protection against eviction without just cause.
Q- Can a landlord charge rent for an unpermitted unit in California?
❌ No, landlords in California are not legally allowed to collect or request rent for an unpermitted unit.
Q- What actions can a tenant take if they discover they're living in an illegal unit?
👉 Tenants living in an illegal unit can still enforce their lease agreement and may sue their landlord for damages, despite the agreement being technically unlawful.
Q- What are just-cause reasons for eviction from an unpermitted unit in California?
👉 Just-cause reasons for eviction from an unpermitted unit include the need for substantial repairs to bring the unit up to code or plans for demolition.