At the request of Supervisor Campos and based on “a random sample of 15 properties” as outlined above, San Francisco’s Budget and Legislative Analyst has just completed an analysis “on the level of profit landlords have made when they sell a building after evicting tenants using the Ellis Act over the last ten years.”
Based on the data collected by the Budget and Legislative Analyst, the average level of profit owners earned selling their properties after Ellis Act evictions was $1,545,949 or 116 percent. Inflation-adjusted profits ranged from -$278 to $4,785,522 for the properties reviewed. The median period between sales for these properties was 3.4 years.
The fatal flaw(s) in the analysis with respect to calculating the average profit:
This return rate does not account for any owner expenditures for improvements made to the properties.
And in addition, “the calculations of profit are not adjusted for the impact of elapsed time between the original purchase of the property and post-eviction sale.”
∙ Analysis of Profits of Ellis Act Eviction Property Sales [sfbos.org]