How Does the Ellis Act Work in Los Angeles?
Updated July 2026. Relocation figures and law current as of this date.
You've got a rent-controlled property in Los Angeles and you're done. Maybe you inherited it from a parent who held onto it for decades. Maybe you're tired of dealing with RSO regulations that feel like they change every year. Maybe the numbers just don't work anymore.
Here's what I tell owners in this situation: you have more options than you think, but the path you choose makes a massive difference in your net proceeds and timeline. I regularly work with families selling rent-controlled properties throughout LA County, often as part of probate or trust administration where the heirs never wanted to be landlords in the first place.
The Ellis Act gets a lot of attention, but it's just one tool in the toolbox. Honestly, it's not the right move for most sellers. Let me walk you through how it actually works in Los Angeles, what it costs in 2026, and how to make the smartest exit.
Want to know what YOUR property would actually net?
Text or call me with your property address and I'll personally run the numbers on your exit options, whether it's a single-family rental or a multi-unit building.
(213) 262-5092No sales pitch. Just your numbers.
What Is the Ellis Act in California?
The Ellis Act is a California state law, Government Code Sections 7060 through 7060.7, that gives every landlord in the state the right to go out of the rental business entirely. The Legislature passed it in 1985 in response to Nash v. City of Santa Monica, a case where a city tried to stop an owner from removing his building from the rental market. The core rule: no city can force you to keep renting your property.
That makes the Ellis Act the main pressure valve built into California rent control. Cities cannot veto your decision to withdraw, but they can regulate how you do it. Los Angeles layers substantial local requirements on top of the state law through LAMC Sections 151.22 through 151.28: notice procedures, relocation payments, and multi-year re-rental restrictions. San Francisco, Santa Monica, and other rent-controlled cities do the same, each with different numbers.
One thing the Ellis Act does not do: it does not strip the property's RSO status. LAHD is explicit that a withdrawn property remains subject to the Rent Stabilization Ordinance, and the city's ZIMAS parcel system permanently flags every property withdrawn under the Ellis Act. In Los Angeles, the statute you are really operating under is the state law plus the seven LAMC sections the city adopted to implement it, 151.22 through 151.28.
How Does an Ellis Act Eviction Work in Los Angeles?
An Ellis Act eviction is a no-fault eviction: the tenants have done nothing wrong, so the law compensates them and constrains you. In California the state statute sets the floor, and in Los Angeles the process runs through LAHD under LAMC 151.09.A.10. Here is the sequence:
- 1. Withdraw everything, not one unit. You must remove ALL rental units on the property from the market at the same time. You cannot Ellis the back unit and keep renting the front two.
- 2. File the Notice of Intent to Withdraw with LAHD. The formal filing (Notice of Intent to Withdraw Units from Rental Housing Use) starts every clock. LAHD assigns a case number and analyst, sends each tenant a letter of introduction, and refers the case to the city's relocation consultant (Interwest), who interviews tenants and issues the relocation determination.
- 3. Serve tenants and file copies. Tenants get a written notice to move out plus the Notice to Tenant of Pending Withdrawal (Form E3), and eviction notices must be filed with LAHD within 3 business days of service.
- 4. Wait out the notice period. The standard move-out date is 120 days from the LAHD filing. If the purpose is demolition for new construction, the notice is 6 months under the Resident Protections Ordinance. Tenants who are 62 or older or disabled and have lived in the unit at least one year are entitled to a full one-year extension, but they must claim it in writing within 60 days of your filing date (LAMC 151.23.B).
- 5. Pay relocation within 15 days. Relocation assistance must be made available within 15 days of serving the termination notice, either directly or through an escrow account under Rent Adjustment Commission Regulation 960.
- 6. Act in good faith. You must genuinely intend to take the property off the rental market (RAC Regulation 610). Filing an Ellis notice as a negotiating tactic invites litigation and city enforcement.
Statewide, the same skeleton applies to Ellis Act evictions in every rent-controlled city, since Government Code 7060.4 authorizes the 120-day and one-year timelines. What changes city to city is the paperwork and the price. In Los Angeles the price is set by a fee schedule LAHD updates every July 1.
Ellis Act Relocation Fees in Los Angeles: The 2026 Amounts
Ellis Act relocation fees in Los Angeles currently run from $11,000 to $27,400 per unit under the schedule effective July 1, 2026 through June 30, 2027 (LAHD Relocation Assistance Bulletin, revised July 1, 2026). The amount depends on tenant status and length of tenancy, and it is paid per unit, not per tenant:
| Household type | Tenancy under 3 years | Tenancy 3+ years or low income |
|---|---|---|
| Eligible tenant (everyone not qualified) | $11,000 | $14,400 |
| Qualified tenant (62 or older, disabled, or with minor dependent children) | $23,150 | $27,400 |
"Low income" means household income at or below 80% of area median as defined by HUD, which for 2026 is $93,300 for one person and $133,250 for a family of four. A tenant only needs to hit ONE trigger (age, disability, minor children) to be qualified, and if more than one amount applies to a unit, you pay the higher one.
Two more layers to budget for. First, LAHD charges the landlord service fees when you file: $623 per unit for eligible tenants or $1,002 per unit for qualified tenants, plus an $86 administrative fee per unit, under the fee chart effective July 1, 2025 (the bulletin notes these increase each July 1, so confirm the current fee when you file). Second, if you are withdrawing in order to demolish and build new housing, the Resident Protections Ordinance requires much larger payments to lower-income tenants: $87,450 for low income, $96,750 for very low income, and $115,480 for extremely low income households for 2026-27.
The reality check most owners need. On a 4-unit building where all four households are long-term qualified tenants, relocation alone is 4 x $27,400 = $109,600, plus roughly $4,352 in LAHD service and administrative fees, before you pay an attorney. Even the cheapest realistic case, four short-tenure eligible tenants, is $44,000. Add lost rent during the notice period and holding costs during the restriction period, and a "free" exit routinely costs six figures. For the full no-fault schedule beyond Ellis cases, see my guide to Los Angeles rent control relocation fees, and remember the LAHD hotline at (866) 557-7368 can confirm what applies to your building.
The Re-Rental Restrictions: 2-Year, 5-Year, and 10-Year Rules
This is the part of the Ellis Act most owners underestimate. Withdrawal is not a clean break; it attaches restrictions to the land that survive a sale. Three clocks start running, all from Government Code 7060.2 and LAMC 151.25 through 151.28:
| Clock | Rule | If you break it |
|---|---|---|
| 2 years | Re-renting any unit exposes you to tenant lawsuits and city enforcement | Actual and exemplary damages; displaced tenants have 3 years to sue; civil penalties under LAMC 151.25 |
| 5 years | Any re-rental must be at the rent in effect when the Notice of Intent was filed, plus allowable RSO adjustments | Rent rollback exposure; the below-market rent binds even a new owner |
| 10 years | Displaced tenants who filed a written interest notice (Form E4 within 30 days of displacement) have a right of first refusal | Punitive damages up to 6 months of contract rent |
There is also a build-back rule: if you demolish and put new rental units on the site within 5 years of withdrawal, the replacement units come under the RSO, even though new construction is normally exempt (LAMC 151.28). You may set the initial rent on those new units, but they are rent-stabilized from then on. These restrictions are exactly why buyers discount Ellis-encumbered properties, and why the 2025 vs 2026 rule changes below matter before you file.
Is There an Ellis Act Moratorium in Los Angeles Right Now?
No. As of July 2026, there is no Ellis Act moratorium in Los Angeles. The COVID-era emergency protections that paused most no-fault evictions ended in early 2023, and LAHD is accepting and processing Notices of Intent to Withdraw on the normal timelines described above. The confusion usually comes from two places: the old COVID rules, and periodic calls in Sacramento to reform the Ellis Act, none of which had become law as of this update.
If you are researching a specific property, you don't have to guess. ZIMAS, the city's parcel lookup, shows an "Ellis Act Property" field under its Housing tab: Yes means the property has been legally withdrawn, No means it has not. Recent filings can lag in the system, so for anything in escrow, confirm directly with LAHD at (866) 557-7368.
What Changed in 2025 and 2026
Three changes matter if the last time you looked at the Ellis Act was 2024 or earlier:
- The Resident Protections Ordinance (February 11, 2025). The LA City Council adopted Ordinances 188481 and 188482, which codified and expanded the state Housing Crisis Act for demolition projects. If you withdraw units and demolish for new construction within 5 years of filing, lower-income tenants get a 6-month notice, a right to remain until 6 months before construction starts, a right of first refusal in the new building, and the enhanced relocation amounts above ($87,450 to $115,480 per unit for 2026-27). Non-compliance penalties start at $250,000 per displaced unit, and LAHD can withhold permit clearances.
- New relocation schedule (July 1, 2026). LAHD's annual adjustment raised the standard RSO amounts to $11,000 / $14,400 for eligible tenants and $23,150 / $27,400 for qualified tenants, effective through June 30, 2027.
- No new state amendments. The state statute itself has not been substantively amended since AB 1399 took effect January 1, 2020. Reform bills surface in most sessions in Sacramento; as of July 2026, none affecting Government Code 7060 had been signed into law.
The practical takeaway: the pure Ellis path got slightly more expensive on July 1, 2026, and the Ellis-plus-demolition path became dramatically riskier for lower-income buildings in February 2025, with per-unit penalty exposure starting at $250,000.
Can I Sell My Building Instead of Using the Ellis Act?
Yes. And for most owners, selling is the smarter exit. The Ellis Act makes sense when you have a long-term plan for the real estate itself: redevelopment, condo conversion, or moving family in for the long haul. If your actual goal is to stop being a landlord and walk away with the most money, compare all four paths first:
Option 1: Sell to an Investor with Tenants in Place
This is the most common approach. Investors specifically seek RSO properties because the tenant protections create predictable, stable income. Yes, your price will reflect below-market rents, but you avoid relocation costs, legal complexity, and years of restrictions. Many of my clients are surprised by the offers they receive.
Option 2: Cash-for-Keys (Tenant Buyouts)
You can negotiate directly with tenants for a voluntary move-out in exchange for payment. In Los Angeles this is regulated by the Tenant Buyout Notification Program (LAMC 151.31): you must serve an RSO disclosure notice before negotiating, the agreement must be in the tenant's primary language, the tenant can cancel within 30 days of signing, and the signed agreement must be filed with LAHD within 60 days. There is no legal minimum price, but in practice the relocation schedule ($11,000 to $27,400 per unit for 2026-27) is the benchmark tenants and their attorneys negotiate from. I break down the whole process in LA Tenant Buyouts Explained.
Option 3: Owner Move-In Eviction (If Applicable)
If you or an immediate family member genuinely intends to live in one of the units, you may qualify for an owner-occupancy eviction. Relocation follows the same $11,000 to $27,400 schedule, though "mom and pop" landlords who own no more than four units and one single-family house in the city may qualify to pay reduced amounts, usable once every three years (LAMC 151.30.E).
Option 4: Full Ellis Act Withdrawal
The right choice when you're demolishing for new construction, converting to condos, or permanently taking the property out of rental use. It's rarely the right choice just to sell, because the 5-year rent restriction and 10-year right of return follow the property into the next owner's hands and get priced into every offer you receive.
2026 Los Angeles Exit Options at a Glance
| Option | Cost per unit | Timeline | Best for |
|---|---|---|---|
| Sell with tenants | $0 relocation | 30-60 days | Quick exit, avoid complexity |
| Cash-for-keys | Negotiated; $11,000-$27,400 relocation schedule is the benchmark | 60-90 days | Flexibility, no re-rental restrictions |
| Owner move-in | $11,000-$27,400 | 60-120 days | You'll actually occupy a unit |
| Ellis Act | $11,000-$27,400 + fees + legal ($87,450-$115,480 for lower-income tenants if demolishing) | 120 days to 1 year notice, then 5-10 year restrictions | Redevelopment, condo conversion |
These are general ranges. Your situation is different.
Text or call me with your property address and I'll tell you what you're actually looking at.
(213) 262-5092No obligation, no pressure. Just clarity.
Why Inherited Rental Properties Are Different
I work with a lot of families who inherited rent-controlled property through probate or trust administration. Your situation has unique considerations.
The Accidental Landlord Problem
You likely didn't choose to be a landlord. Your parent or grandparent acquired this property decades ago, and now you're suddenly responsible for RSO compliance, habitability requirements, tenant relationships, and property management. Possibly from across the country.
Stepped-Up Basis Advantage
You may have stepped-up basis working in your favor. If the property appreciated significantly during your parent's ownership, the tax advantages of selling now versus holding can be substantial. This is general information, not tax advice; a good real estate CPA should run your specific numbers.
The Human Element
You're often dealing with long-term tenants who had a relationship with the original owner. There's a human element here that matters, both ethically and practically. How you handle the transition affects whether tenants cooperate or fight.
I specialize in exactly this scenario. My team handles complex inherited property sales throughout Los Angeles, and rent-controlled properties are a significant part of that practice. We've developed approaches that protect your interests while treating tenants fairly. And the math is often better than heirs expect: stepped-up basis resets the taxable gain to the date-of-death value, which for buildings held since the 1970s can shelter decades of appreciation.
Inherited a rental property you never wanted?
Whether it's a house with a long-term tenant or a fourplex with RSO units, reach out with the address. I'll map your exit options and include the stepped-up basis math most CPAs miss.
(213) 262-5092Just information. You decide what to do with it.
The Numbers You Need Before Making a Decision
Before you decide on any strategy, get clear on these figures:
Current market value with tenants in place: This is what investors will actually pay. It's based on income potential and the specific tenant situation. Since RSO rents can only rise by the city's annual allowable increase (see the current caps in my guide to Los Angeles rent increase rules for 2026), buyers underwrite off today's rent roll, not market rents.
Potential value if vacant: The difference between occupied and vacant value tells you the maximum benefit of any tenant relocation strategy, and whether it's worth pursuing.
Total relocation costs: Calculate what you'd owe under each scenario using the current LAHD schedule ($11,000 to $27,400 per unit through June 30, 2027), and remember tenant status can move a single unit's cost by $16,400.
Holding costs during any restriction period: If you Ellis the property, what does it cost you to own it for 5 years before you can re-rent at market, or 10 years before the right of return expires?
Tax implications: This is especially important for inherited property. A good real estate CPA should be part of this conversation.
I provide this analysis as part of my initial consultation with RSO property owners. No obligation, no pressure. Just clarity on your actual position, built on the LAHD schedule that runs through June 30, 2027.
Common Mistakes I See Owners Make
Filing Ellis Act without running the numbers. I've seen owners spend six figures on relocation and legal fees to achieve a sale price that barely exceeded what they could have gotten selling with tenants in place. On a 4-unit building, run the $44,000-to-$109,600 relocation math first.
Trying to force tenants out through neglect or harassment. This is illegal, exposes you to massive liability, and LAHD actively investigates complaints under the Tenant Anti-Harassment Ordinance. Don't do it.
Doing cash-for-keys off the books. Unfiled buyout agreements violate LAMC 151.31 and give the tenant the right to cancel the deal at any time, even after they've moved out. Serve the disclosure, put it in writing, file it with LAHD within 60 days.
Not consulting professionals before signing anything. Once you file a Notice of Intent to Withdraw, you've triggered obligations and timelines that are hard to unwind. Get proper legal and real estate guidance first.
Assuming all buyers want vacant properties. The investor market for occupied RSO property is robust. Many buyers specifically seek the stable, below-market rents as a feature, not a bug, and they close in 30 to 60 days.
Frequently Asked Questions
What is the Ellis Act in California?
The Ellis Act is a California state law (Government Code Sections 7060-7060.7, adopted in 1985 after Nash v. City of Santa Monica) that lets landlords go out of the rental business by withdrawing every unit on a property from the rental market. It overrides local rent control on the exit decision itself, but cities like Los Angeles regulate the process: notice periods, relocation payments, and re-rental restrictions.
How much does an Ellis Act eviction cost in Los Angeles?
For July 1, 2026 through June 30, 2027, LAHD relocation is $11,000 to $14,400 per unit for eligible tenants and $23,150 to $27,400 per unit for qualified tenants (62 or older, disabled, or with minor children), per the LAHD Relocation Assistance Bulletin revised July 1, 2026. A 4-unit building with long-term qualified tenants runs $109,600 in relocation alone, before LAHD service fees and legal costs. If you are demolishing for new construction, lower-income tenants receive $87,450 to $115,480 per unit under the Resident Protections Ordinance.
How long does the Ellis Act process take?
The minimum is 120 days from filing the Notice of Intent to Withdraw with LAHD. Tenants who are 62 or older or disabled and have lived in the unit at least one year get a full year if they claim it within 60 days of your filing. Demolition for new construction requires a 6-month notice. After the units are vacant, re-rental restrictions run 5 years and the right of return runs 10 years, so plan on 5+ years before the property is fully unrestricted.
Can I sell my building instead of using the Ellis Act?
Yes, and for most owners it is the better exit. Selling to an investor with tenants in place requires no Ellis filing, no relocation payments, and no re-rental restrictions, and a typical escrow closes in 30 to 60 days. Your price reflects the in-place rents, but you avoid the $44,000 to $109,600 a 4-unit Ellis withdrawal typically costs and the 5 to 10 years of restrictions that follow.
Is there an Ellis Act moratorium in Los Angeles?
No. As of July 2026 there is no Ellis Act moratorium in Los Angeles. The COVID-era emergency rules that paused most no-fault evictions ended in early 2023, and LAHD is accepting and processing Notices of Intent to Withdraw as normal. You can check whether any property has been withdrawn under the Ellis Act using the city's ZIMAS parcel system.
What happens if I re-rent a unit after an Ellis Act withdrawal?
Within 2 years, displaced tenants can sue for actual and exemplary damages (they have 3 years to file), and the city can pursue civil penalties under LAMC 151.25. Within 5 years, any re-rental must be at the rent in effect when you filed, plus allowable RSO adjustments. Within 10 years, displaced tenants who requested it in writing have a right of first refusal, and skipping them risks punitive damages of up to 6 months of rent.
Can I sell my rent-controlled property without evicting the tenants?
Yes, and this is often the smartest approach. Investors actively seek RSO properties with tenants in place because the regulated rents create predictable income. Your sale price reflects current rents, but you avoid relocation costs, legal fees, and re-rental restrictions. Many sellers net more by selling occupied than by paying for a vacancy process first.
What is the difference between RSO and non-RSO properties in Los Angeles?
Properties with 2 or more units and a certificate of occupancy issued on or before October 1, 1978 generally fall under LA's Rent Stabilization Ordinance. Single-family homes, condos, and newer construction are typically exempt from the RSO, though state law (AB 1482) may still apply. LAHD's online RSO property search tells you a specific property's status in about a minute.
Ready to See Your Real Numbers?
Every rental property is different. Tenant situation, property type, local regulations. It all changes your costs and which exit makes sense.
Text or call me with your property address and timeline. I'll personally review your situation and get back to you within 48 hours.
(213) 262-5092No pressure. No obligation. No awkward sales pitch.
Just a clear picture of your options so you can make the right call for your situation.
