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real estate agent in Los Angeles County has become the first person to face criminal charges for price gouging following the devastating wildfires that ravaged Southern California this month. The state's attorney general, Rob Bonta, vowed to hold price gougers accountable and warned of more charges to come.
The wildfires have burned tens of thousands of acres and destroyed thousands of structures, leaving many people homeless. Experts estimate it may be the biggest wildfire insured loss in US history. The displacement of thousands of Californians has caused demand for rental units in Los Angeles County to skyrocket, with a low inventory statewide.
Under California law, price gouging is illegal during an emergency. Businesses can increase prices by up to 10% over the previously advertised price, but no more. For rentals not previously advertised, the asking price cannot exceed 160% of the fair market rent established by HUD. An emergency was declared in California on January 7, and an executive order extended laws prohibiting price gouging until January 7, 2026.
A Justice Department investigation revealed that real estate agent Mike Kobeissi tried to rent out a home at a price 38% higher than advertised before the fires. However, Kobeissi claims the price increase was due to the property's location in a prestigious school district and not related to the wildfires. He is facing one misdemeanor count of price gouging.
Bonta praised the public for reporting incidents of price gouging and warned that those who engage in such practices will be held accountable. Los Angeles County Sheriff Robert Luna also condemned price gouging, stating that anyone taking advantage of victims will face consequences. Zillow encouraged renters to report potential violations and provided resources to help housing providers understand their responsibilities.
More charges for price gouging are likely to follow Kobeissi's case, as analysis of data found nearly 400 listings with prices that have skyrocketed since the fires struck the region.
