Landlords - Renting or leave vacant or AIRBNB?

Berkeley landlords what are you doing now with your vacant units?  Are you leaving them vacant for the summer? Renting at below market value?  Or converting to AIRBNB?  We have a sudden vacancy and are finding Berkeley Rent Control laws have made it extremely unfavorable to rent right now.  With rents in Berkeley about 20-25% below pre-COVID prices if we were to rent now once prices rebound, we will not be able to get fair market rent until the person moves.  (We have one tenant who’s been paying $500 per month below market value of 8 years.)  We don’t want to do that again.  We are hearing many landlords are leaving units vacant so as not to be trapped in low rents.  Or they are AIRBNBing.

Just wondering what other landlords in this situation are doing?  Thanks

Parent Replies

Parents, want to reply to this question? Sign in to post.

Here's a way to ride it out. Do some networking with contractors who have clients who are doing major home remodels. Those are the families that are wanting a 5-9 month rental. They are out there!

Feel your pain as a fellow owner with a twenty-five year tenant for whom I pay all gas, electricity, water and garbage. And she plants thirsty roses. Please join one of the owners groups. I joined East Bay Rental Housing Association last year, and found the round tables, seminars, and Q & As quite helpful. You may want to take a chance on a summer session rental. Try to find a tenant whom you can be sure will move out in a few months. But of course no guarantees.

It's funny that you posed this question as we were just having this discussion in my house last night about what to do with the vacant unit in our house.  The unit has been vacant for about a year now after our long-term tenant moved from California mid-pandemic.  Initially we thought we would look for a new tenant later in the summer and closer to the re-opening of Cal, but have re-thought that strategy in light of the Rent Control laws.  We've since decided to permanently take the unit off the market and will either look to short-term rentals or converting the space to a home office.  The more we became aware of the pretty draconian Berkeley Rent Control laws the more we realized that by renting our unit out we are putting ourselves in a situation that may prove to be too risky for us to justify.  I hear what you're saying about being trapped to rents that may be way below market-rate in the near-term, and understand that concern too, but for us it's really more of the risks associated with having no rights in the tenant-landlord relationship and the legal risks associated with renting the unit.  Whatever you decide to do, I would encourage you to understand the way the wind is blowing with the Rent Control Board and protect yourself!

I just wanted to share from a renter's perspective...I hope that my feedback isn't offensive to you and that it might offer you and others here something to consider. Please consider renting your unit below market rate. I believe that market rate rents in Berkeley are harming the integrity and longer-term vitality of the community. My partner and I are both full time professionals in Berkeley and make substantial salaries with benefits, and have very little debt. Even given our relatively fortunate financial circumstances and the lower pandemic rental rates, it has been a disheartening and painful struggle to find decent housing that will allow us to consider staying in the area to have a family and spend time making art. Most people are honest renters who want a healthy, safe, lovely and affordable (relative to their income) place to live...just like homeowners. From my own perspective, the fair market rate that landlords are holding out for seems to be well above what so many vital and beautiful members of the Berkeley community can pay. If you are a landlord who can offer a place to live at a rate that may be below "market" but actually on par with what low and middle (even upper-middle, like I consider our income to be) income Berkeley residents can afford, that is a tremendous value and contribution to your community - and by extension a gift to yourself and your family. It creates a rental market that supports essential workers, like us, that the whole city needs. We have been landlords - it is quite simple and does not need to be a full time endeavor. Choosing to earn less money from your rentals and accept below market rate is a powerful and humble service to your community. Thank you for considering my perspective. If it is not of value to you, please feel free to pass over it. 

Hi! We use our unit as a short term rental on Airbnb. We’ve never used it as a long term rental though, and I will say that the rules are pretty specific for short term rentals in Berkeley. I believe if you rent it for 30 days or more that is considered long term and although you’ll run the risk of a squatter (because the tenant would have full renters rights after 14 days), if you feel confident that they will leave, then that may be the way to go. I’m pretty sure you can’t do a short term rental legally in your situation, except potentially for up to three months of the year…but happy to talk details offline if you’d like! Google city of Berkeley and short term rentals.