Governor Newsom issues order to protect fire victims from predatory real estate speculators

News

Jan 14, 2025

What you need to know: Governor Newsom issued an executive order barring opportunist and predatory investors from making unsolicited undervalue offers to families impacted by the firestorms to buy their land, taking advantage by offering fast cash for destroyed property.

LOS ANGELES - Governor Gavin Newsom today issued an executive order to protect firestorm victims in the Los Angeles area from predatory land speculators making aggressive and unsolicited cash offers to purchase their property. Taking advantage of the disaster and associated trauma, these predatory and exploitative practices endanger the financial well-being and security of vulnerable victims. Today's announcement will allow the state to hold these predatory speculators accountable through stronger enforcement and prosecution.

"As families mourn, the last thing they need is greedy speculators taking advantage of their pain. I have heard first-hand from community members and victims who have received unsolicited and predatory offers from speculators offering cash far below market value - some while their homes were burning. We will not allow greedy developers to rip off these working-class communities at a time when they need more support than ever before."

Governor Gavin Newsom

The executive order safeguards residents of hard-hit zip codes in Los Angeles County from these predatory practices. This includes the community of Altadena, a working-class neighborhood that has been especially hard hit by the Eaton Fire, which has damaged or destroyed large swathes of the community, including much of the downtown area, numerous places of worship and cultural centers, countless businesses, and likely thousands of family homes. Undermarket offers by opportunistic investors in communities such as Altadena threaten the character and vibrancy of the community and could displace and endanger vulnerable residents who have long ties and investments in the community.

The Governor's executive order:

• Makes unsolicited undervalued offers to purchase property from property owners in specified zip codes of Los Angeles County unlawful for a period of three months from the date of this Order.

• Directs the Department of Real Estate, along with other state agencies, to provide notice to the public of their rights under the law, resources for more information, and contact information for law enforcement agencies, such as the Attorney General's Office and District Attorney, with the power to enforce the prohibition.

California law makes it a misdemeanor to violate a Governor's order during a state of emergency, which can be prosecuted by the Attorney General or local district attorneys. Violations can be reported to the Attorney General's office at oag.ca.gov/report.

This executive order is modeled on a similar order issued by Hawaii Governor Josh Green to preserve local communities and protect residents from exploitation after wildfires destroyed the town of Lahaina and surrounding areas in August 2023.

A copy of the executive order can be found here.

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