More than 50 people descended outside a Palo Alto business on Wednesday afternoon to protest a rent increase by more than $1,000 on an East Palo Alto family, which threatens to force a father, mother and four children out of their home.
Vowing to shame the company, Working Dirt LLC, for what the group called the company's unbridled greed, supporters of the Fetuu family stood on four corners outside the business at 801 High St. near Homer Avenue with signs and chanted slogans against the predatory rent increases that are pushing families from their homes and community. The business's entrance was locked, so they slipped a letter of protest under the door.
The protesters said they want to bring attention to what they called obscene rental increases and to urge the repeal of the 20-year-old Costa-Hawkins Act, which restricts renter protections on single-family homes. The act is an outdated, real estate industry-backed law that protects landlords' profits and not people, said Stewart Hyland, a community organizer with Faith in Action Bay Area.
"Corporations and speculators have started to dominate the rental market since the foreclosure crisis. Hundreds of houses in East Palo Alto have been snapped up and middle-income renter families need real protection. We need to repeal Costa-Hawkins so that cities can protect our families from displacement by vulture investors," he said.
The protest perhaps marks a new turn in East Palo Alto activism, one that is shining the spotlight on actions that hurt the community by coming directly to the door of the speculators and corporate investors.
East Palo housing prices have climbed rapidly, as affordable housing in surrounding communities such as Palo Alto, Menlo Park and Mountain View have gone out of reach for nearly all except the wealthy. The city once known for its crime statistics is now becoming known as the last bastion of affordable housing on the Peninsula, although that term is relative.
The median home value in East Palo Alto is now in the mid-$700,000s, an increase by 12.5 percent over the past year,according to online real estate website Zillow. According to rent-trend data from Trulia.com, as of April 2017, the median rental within the city is $2,950. The one-bedroom unit median is $1,700; two-bedroom is $2,950 and a three-bedroom rental is $3,500, according to Trulia.
The Fetuu family recently received a rent increase of $1,050 dollars a month, raising their payments from $2,800 to $3,850 a month. That sum comes on top of a previous increase of $300 a month, which was already a burden on the family, father Saia Fetuu said.
Fetuu, a self-employed landscaper by trade, said the family previously owned the home on Clarence Court. They lost it in a short sale in 2011 during the housing crisis.
A large balloon payment raised their mortgage to $4,500 a month — a 16 percent increase, he said. Working Dirt snapped up the property along with 17 others.
The family stayed on as renters. They have lived in the home since 2004, but nothing gets fixed when it is broken, they said.
When the family faced the $300 rent increase last year, mother Malina, a homemaker, took a job as a babysitter to help make ends meet. But the family, which includes children Sione, 17; Latai, 16; Nesi, 14, and Ofa, 10, now cannot meet the $1,050 a month increase, a fee the landlord said was required two months ago.
The Fetuu family is not alone.
"There has been a mass exodus of people from East Palo Alto who now have to travel three to four hours to work. It's an atrocity. It is like racist displacement. You know people there can't afford these rent raises," Shanna Uhila, a supporter, said.
"Stop Racist Displacement," a cardboard sign Uhila held read.
Uhila said she has lived in East Palo Alto since 1980.
"This is a challenging thing for me. I have never done anything like this before. But I've seen bullets in my town; I've seen drugs. But I've never seen people who have pushed people out of their homes." And that's another kind of violence, she added.
Jason Tarricone, directing attorney for the housing program at Community Legal Services in East Palo Alto, said he has written two letters to Working Dirt, which is headed by investor Abraham Farag, requesting that the landlord rescind the rent increase and talk to the family about a more reasonable rent, but the company has refused to budge.
Tarricone and the protesters said they understand that the high rent increases are not illegal per se. "But it is immoral," Tarricone said.
"They are already making a huge profit. They bought these homes for pennies. They have already taken the money out of East Palo Alto. The rent is already $2,800. I'm a homeowner. That's more than my mortgage," he said.
The protesters said they have no grudge against mom-and-pop landlords with one or two properties; it's the corporate investors who snatch up large numbers of properties with whom they take umbrage.
"Don't be a vulture investor. Don't come into poor communities and price people out. Be a good, scrupulous landlord," said Patty Garcia, a volunteer supporter with El Comite de Vecinos, a local community-action group.
Farag and the company could not be reached for comment. Court records filed in U.S. District Court in San Francisco show he is one of five men indicted in October 2014 for bid-rigging and mail fraud related to real estate transactions at public auctions. The men obtained dozens of properties in San Mateo County, including in East Palo Alto, according to the indictment by the U.S. Department of Justice. The case is still active, although the two counts for mail fraud were dismissed against Farag on Oct. 13, according to court records. He still faces the bid-rigging charge.
Although an immediate goal is to reduce the Fetuu family's rent, the protesters are also asking state representatives to change the Costa-Hawkins law, which they said is hurting so many other working families.
"There's no rent control on any single-family homes or condominiums, even if a Wall Street private equity firm owns 20,000 homes," Daniel Saver, Community Legal Services housing program senior staff attorney, said.
CORRECTION: A previous version of this story stated that Patty Garcia is with El Comite Latino.