PD Editorial: A new peril that’s preventable and deplorable: gouging

One day after losing his home in the hills northeast of Santa Rosa, Jeffrey Sugarman was on the web searching for a rental. With the help of Zillow, he came across a home on Arabian Way in Healdsburg for $3,700 a month. Two days later, he reached out to set up a visit only to find that the asking price had gone up to $4,700, and the landlord told him that he should be prepared to pay as much as $5,000 if he really wanted the place.

“He said that’s what the insurance will pay, and that’s what we are going to charge,” said Sugarman. “He was very upfront about it.”

Shawn Devlin who lost her house off Cross Creek Way in Skyfarm had a similar experience - only worse. She and her husband had arranged through their real estate agent to see a home in Novato that had been on the market for some time. It was listed for $5,000 a month. At 8:30 a.m. on Thursday, they had an appointment to see the place. By the time her husband and the agent arrived at 11:30 a.m., the price had gone up to $9,000 a month.

Devlin’s agent felt so bad she apologized on behalf of her profession. “She was so disgusted,” said Devlin. “Here, I’m going to be out of a house for two years. We had to run for our lives, and this person is going to nearly double the price on us? It’s unfathomable.”

Yes, it is. It’s also illegal.

The California Penal Code, Section 396, prohibits raising the price of many consumer goods and services, including housing, by more than 10 percent after an emergency has been declared. According to the state Attorney General’s Office, local laws also can be adopted with other prohibitions on price gouging, something the Sonoma County Board of Supervisors and local city councils should consider.

Sonoma County District Attorney Jill Ravitch has pledged to take price gouging as seriously as looting. At a news briefing Friday, Ravitch cited the 10 percent increase threshold and encouraged victims to call her office to report violations. “We’ll do an investigation of it,” she said. “That will not be tolerated.”

Reports have surfaced of other problems as well, including families suddenly being notified that their rents will be increasing substantially. Some also report having experienced sudden price increases elsewhere, including at hotels.

Natural disasters like this week’s historic firestorm bring out the best in us. We have plenty of examples of people who have worked tirelessly to save lives, protect homes and shelter people who have nothing left. But as noted above, these times also can bring out the worst in us. With vacancy rates around 2 percent and the housing supply failing to keep up with demand, Santa Rosa already had a severe housing crisis before being visited by this week’s devastation. Given the loss of nearly 2,900 homes in Santa Rosa alone, as well as dozens of homes in neighboring areas, the situation is going to get worse. This has been a key topic of discussion in recent days and will take on greater importance in the days ahead.

We, as a community, essentially have two choices. We can help our devastated neighbors transition back into the community, or we can make their journeys far more difficult by seeking to profit from their misfortune. We prefer the former. We prefer the approach of one of our letter writers, Beth Sawatzky of Healdsburg, who is calling upon the many people who own second homes in Healdsburg to rent them “at a reasonable rate to people who have lost their homes.” It would be a good start.

Yes, price gouging happens. But let’s not let it happen here. We are better than that.