Landlords and realtors in LA accused of raising rent prices by 134% following devastating fires

Allegations have been made against money-hungry landlords and real estate agents for hiking up rental prices in the Los Angeles area following the disastrous wildfires that rendered thousands of residents homeless and displaced.

Amid the ongoing devastating Palisades blaze that is causing havoc in the city and affecting residential areas, opportunistic landlords have wasted no time in raising rent rates by up to 134 percent, as shown by listings examined by DailyMail.com.

These alarming price hikes have taken place despite a state of emergency declared by California Governor Gavin Newsom, which prohibits price gouging exceeding 10 percent of pre-disaster prices and carries penalties of a potential one-year imprisonment along with a $10,000 fine.

The inflated figures have sparked outrage among tenant rights advocates as well as some local realtors who have condemned the behavior as ‘predatory’ and ‘disgusting.’ However, other agents have claimed they were unaware the declaration was in effect. 

LA realtor Trey White, who grew up in Pacific Palisades, said he is ‘appalled’ by the price hikes during such a challenging time. 

‘It’s a frenzy right now,’ he told DailyMail.com. ‘I’m seeing people raising rents by 10, 20, 50 percent just to try and get some more money through this devastation.

‘I’ve been working non-stop trying to help my community,’ White added. ‘I don’t even know what to say anymore. It’s wild. It’s something I’ve never heard of happen’.

White, who works for real estate firm Compass, said he had ‘naively’ hoped that landlords would offer discounts to people made homeless by the fires but instead it has ‘turned into the opposite’.

‘I’m appalled by the entire situation,’ he said. ‘I’m from the Palisades so I’m helping my friends and family to get places to live. 

‘I understand when supply meets demand but when it’s an essential good – which housing is – it’s price gouging and it’s illegal for a reason.’

The rent increases have put extraordinary pressure on families who are already reeling from the sudden and traumatic loss of their homes and are now desperately searching for somewhere to live.

Among the listings which have gone far beyond the legal limit is one three-bedroom Mid-City apartment whose owner jacked it up twice since the fires had begun.

The unit was going for $5,500 a month in December before being raised by 36.4% to $7,500 on January 10. It then jumped to an astonishing $15,000 a month, a day later. 

Realtor to the stars Santiago Arana, who appeared on Netflix’s Buying Beverly Hills and claims to have sold $4.6billion of real estate, was linked to a four-bedroom single family home in Brentwood that saw a $5,000 increase from November, according to records. 

Realtors for other rental properties have listed new rent prices over the 10 percent limit but have claimed they didn’t know the law was in effect.

The moves have led to bidding wars between families. In one case a prospective tenant put down $1.5million, the equivalent of two years’ rent upfront, just to get a home – but wass still unsuccessful. 

At least 25 people have been killed and thousands of homes have been destroyed by the five fires that have consumed LA over the past week.

The Pacific Palisades neighborhood has been almost completely eradicated by fire, and Altadena, an area north of the city has lost thousands of homes and structures. 

But rather than taking part in efforts to rebuild and help out the community, some realtors and homeowners are using the disaster as a chance to make a profit.

That is in defiance of the emergency declaration filed by the California governor which enacts Penal Code 396, banning rental increases over 10 percent.

California Attorney Genera Rob Bonta warned against scammers and ‘bad actors’ during a press conference on Saturday. 

‘Following a declaration of emergency, the statute generally prohibits landlords from increasing the price of rental housing by more than 10% of the previously charged or advertised price,’ he said. 

He added that disasters like this ‘bring out bad actors who seek to use the trauma, the chaos of moments like this for their own gain’.

Bonta, however, would not comment on whether the department is engaged in an investigation.

Many of the properties reviewed by DailyMail.com had been listed for hundreds of days yet had not found a renter, making their increases in price after the fires appear all the more calculated. 

They included a five-bedroom home in Santa Monica which boasts a view overlooking a golf course, a chef’s kitchen, and three levels of outdoor space.

In a nod to renters who had lost everything, the listing states that it ‘comes fully furnished’.

It had been listed for $12,750 but on January 10 the rent went up to $28,000, an increase of 119 percent.

When DailyMail.com called Gabriel Palmrot, the realtor listed on the property, the call dropped and he did not respond to messages asking to call back.

Another Los Angeles rental property, a three-bedroom home in Mid City, had its rent increased twice in two days after the fires had begun.

The home, which comes furnished with two queen beds, a bunk bed, a sofa bed and a family room with brand new pool table, was listed for $5,500 last month.

But on January 10, days after the fires tore through the Palisades area, the price went up to $7,500, a rise of 36.4 percent.

The very next day it went up again, this time by 100 percent, to $15,000. The listing has since been removed along with the name of the realtor.

DailyMail.com contacted the owner who did not respond to requests for comment.

Tenant rights advocate Chelsea Kirk – the director of policy and advocacy at the LA-based Strategic Actions for a Just Economy – became so frustrated with the price gouging she started a Google doc with all the examples she could find.

When she opened it up to the public there were hundreds of entries within days.

Kirk said: ‘It’s profoundly shameful and predatory. It’s disgusting. It’s also illegal.

‘Governor Newsom issued a state of emergency meaning price gouging is capped at 10 percent and these increases are above that.

‘If there’s anything good that comes out of this, it’s that people are seeing plain and clearly the greed of the landlord class.’ 

Among the other examples of price gouging is a four bedroom property in Glendale which had been $8,500 per month but on January 13 the price went up to $19,500, a rise of 129.4 percent.

Phone calls to the number on the listing were not returned. 

A five-bedroom home in Los Angeles had been on the market for $7,500 as of December last year, already a 315 percent increase on the previous rent.

But then on January 8, the price went up again, another 100 percent, to $15,000. It went down 20 percent on January 11 to $12,000 but that is still a rise of 80 percent.

Reached on the phone, Kevin Danialifar, who is leasing the property, tried to claim that because it hadn’t been rented out the owner could charge whatever price he wanted.

He said: ‘I don’t think this falls into price gouging. This was never leased at any price. They can put it up to $20,000 if they want.

‘This is not a rent-controlled property either. It’s fully furnished, the value of the furniture is very high’.

When asked why the rent increase happened on January 8, the second day of the fires, Danialifar said he was ‘just following orders’.

Another LA realtor, David Akhtarzad was named on two listings which had increases over the 10 percent limit. 

In one case, a luxurious seven-bedroom, 10-bath home in Beverly Hills went from $89,950 a month to $114,950 a month on January 10, a rise of 27.8 percent.

When DailyMail.com called to inquired about it, the listed price was reduced the same day to $98,750, leaving a nine percent net increase from the original figure.

The other property was a six-bedroom, 10-bath mansion with a pool, also located in Beverly Hills, which went up from $89,950 a month to $109,950, an increase of 22.2 percent.

In a phone interview, Akhtarzad initially appeared defiant and said that the increases were not price gouging.

He said he had ‘no idea’ about the price increases – despite being the realtor on the listings – and said he would have to speak to the owners.

Akhtarzad also claimed he didn’t know about the 10 percent price increase cap to stop gouging and said: ‘Thank you for bringing it to my attention’.

After DailyMail.com called, it went down 10.2 percent to $98,750. 

In the affluent neighborhood of Brentwood, the landlord behind a four-bedroom, three-bathroom home once owned by Priscilla Presley’s mother, also tried to apparently capitalize on the emergency. 

The property had been on the market for 230 days in November last year when the price dropped to $12,000 per month.

But on January 9 this year it was raised to $17,000, an increase of 41 percent.

The listing was handled by reality star Arana, whose previous clients have included Lady Gaga, LeBron James, Ben Affleck, Jennifer Lopez, Larry David, and Anthony Hopkins.

Arana told DailyMail.com that there was ‘confusion’ about the rules and claimed that ‘we’re not guided by the rules’.

The owner ‘didn’t want to gouge anyone’, Arana said, and claimed that the price was increased because people had offered that amount of money.

Robin Walpert, a realtor with Sotheby’s Realty, went viral for a video shared on Instagram which described how a family was outbid on a house where they offered the listed $30,000-a-month rental price by another family who offered $51,000 instead.

Not only that but the other family offered to pay the two years of rent up front – a total of $1.5million.

Walpert said: ‘It’s so competitive, and it’s desperate. People are willing to throw it all in to have an air of protection during this time when nothing feels that way.

‘It’s been a carousel of crying families: 10 families in a property, 15 applications for the same home. Frequent bidding wars.’

Walpert said had been left appalled by owners like a woman in Santa Monica who said she had a home to rent out, but then quoted a price four times the normal rate.

‘I told her she could take a hike,’ Walpert said.

‘That was very disheartening and she wound up apologizing. It felt so hurtful to take advantage of your community, your kids’ classmates, the people you sit next to on the July 4th parade and just stab them while they’re down’.

Another real estate professional based in Los Angeles told DailyMail.com that realtors who went above the 10 percent increase were a ‘disgrace’.

‘They’re giving the rest of us a bad name,’ the realtor, who wished to remain anonymous, said. 

‘They should be ashamed of themselves. People have lost their homes, their communities. This is outrageous.’