Fullerton Seniors Receive 31-Page Rent Increase Lease

Fullerton Seniors Receive 31-page Lease Agreement for Mobile Home Space Rent Increase

The homeowners living in the Rancho La Paz Mobile Home Park, 501 E. Orangethorpe, have received a 31-page lease agreement from new park owner John Saunders. In addition, the document includes 40 double-sided pages of attachments. As a comparison, a standard residential lease agreement according to the California Association of Realtors is 5 to 7 pages.

Legally, a one- year lease must also be offered – but tenants at Rancho La Paz must ask for that option. The lengthy lease full of confusing legalize is hard to read for a native English speaker – but although there are about 25 households of Spanish speaking homeowners – it is only offered in English.

The Rancho La Paz “agreement” begins with a recommendation that the homeowner have it reviewed by an attorney and that signing the document exempts the park from “any ordinance, rule, regulation or initiative measure adopted by any local governmental entity which establishes a maximum amount that a landlord may charge a tenant for rent.”

The lease provides for six or ten years of graduated rent increases beginning November 1, 2019: 19% increase each of the first two years; 15% increase the third year; 9% increase in year 4 and 5; and a 7% increase per year from the 6th to 10th year.

According to the difficult-to-comprehend lease agreement there are additional monthly costs including a $25/month rent “check handling” charge.

Rancho La Paz Homeowners Association President Lupe Ramirez said, “Three attorneys have looked at the lease and said it is one of the worst they have ever seen. But as usual with John Saunders, it is legal. Most residents will sign a long-term lease because Saunders repeatedly told us in negotiations that (if they don’t sign) he will raise rents every six months for those on a month-to-month agreement. The people who already received the lease say the actual lease is over 70 pages.”

Saunders offered a rent subsidy program administered by Vickie Talley of Talley & Associates whose website (https://talleyassoc.weebly.com/mhp-conversions.html) notes they specialize in mobile home park conversions and closures for park owners since 1981. That subsidy program application was for one year and required the homeowner to list name, address, contact info, employer and salary of all relatives not living with the homeowner. In addition, the requirements included 10 years of homeowner past tax records and numbers of all bank accounts, plus list of the value of all possessions including jewelry and furniture.

Fullerton Mayor Jesus Silva, Anaheim Councilmember Jose Moreno, and Fullerton Councilmember Ahmad Zahra (pictured above) along with Anaheim Councilmember Denise Barnes tried to help the Rancho La Paz homeowners.

On August 6, despite the pleas of numerous Rancho La Paz homeowners, Fullerton City Council voted not to enact a temporary rent hike moratorium. On August 20, Fullerton City Council did approve a Safety Net with up to $350,000 in federal funds to establish a Tenant-based Rental Assistance Program for mobile home park residents. For those low-income homeowners who qualify the program can help with the rent increase. However the continuance of the program depends on whether the federal funding continues, so it is not a long-term solution.

Still, some homeowners feel the new lease agreement is better than Saunder’s original effort to raise space rents by 40% to 70% within a few months of buying the property. History of Saunder’s and his partners Rob Coldren and Pacific Current Partners (www.pcpequity.com) and Mike Cirillo of Star Management (www.starmanagment.com) shows similar actions taken against homeowners in the over 30 mobile home parks they have purchased.

Senior homeowners filled the clubhouse at Rancho La Paz to try to get help from new park owner Saunders huge space rent increases.

Most of the resident homeowners of Rancho La Paz are seniors living on fixed incomes. They own their mobile homes (or are paying mortgages) but must pay rent on the rectangle piece of property where their home sits. They also pay property tax on their mobile homes and pay for utilities. Although called mobile homes – the homes are very expensive to move even when a vacant space can be found. So, unlike other renters who may be able to move more easily, mobile homeowners are virtually a captive audience.

The park straddles the cities of Fullerton and Anaheim at 501 E. Orangethorpe, with about half in each city. Anaheim City Council also failed to pass a temporary anti-gouging ordinance proposed by Councilmember Jose Moreno. With space rents increasing to $1,500 or more many will have to take a loss on their homes, sell and move out of the park. There are currently 40 mobile homes for sale at the park.

Unfortunately, neither Anaheim or Fullerton city councils followed the long time example of San Juan Capistrano’s successful mobile home rent control ordinance adopted in 1982 where increases are tied to the Consumer Price Index. That system has survived court challenges by Saunders attorney Rob Coldren. The system provides mobile homeowners with protection as well as granting fair increases to park owners.

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