Dozens of state-mandated low-cost condominiums in Dana Point may have been sold illegally on the open market, denying low-wage earners the chance to buy the homes, California Coastal Commission officials said Friday.
The agency is considering legal action to recover damages and profits from the illegal sale or lease of dwellings in Dana Point, Laguna Niguel and San Clemente, said Peter Douglas, the panel's executive director.
The enforcement action on the properties, which were built as part of the commission's affordable housing requirements in the late 1970s and early 1980s, is proceeding under a $300,000 state grant. The commission is investigating hundreds of buyers who allegedly sold or rented their properties in violation of purchase agreements requiring them to live in the condos.
"We might want to go after any illegal profits," Douglas said. "The sales contracts clearly state what has to be done."
Commission officials are to meet next week with the state attorney general's office to discuss possible legal action.
Douglas said he did not have a precise number, but his staff has discovered "dozens" of low-cost housing units that may have been sold improperly at the Niguel Beach Terrace condominium complex in Dana Point. Commission officials said Thursday that a substantial number also are being rented out.
About 200 Niguel Beach Terrace dwellings were sold to low- or moderate-income buyers in the early 1980s at below-market prices of about $65,000, with the requirement that the home remain owner-occupied for at least 20 years. If a buyer moves before the term expires, the property must be sold back to a public housing agency at a modest profit so it remains affordable for the next low-income buyer.
From 1977 to 1981, the Coastal Commission required developers in coastal Orange County to set aside 25% to 35% of their homes for low-income workers, who qualified for government subsidies to buy them.
The Legislature ended those requirements in 1981, but not before hundreds of units covered by the rules had been sold at six condominium complexes in Dana Point, Laguna Niguel and San Clemente.
This week, the commission began issuing cease-and-desist orders to the owners of about 175 affordable housing units at Niguel Beach Terrace. They are suspected of renting their properties for up to $2,000 a month to people who probably would not qualify for low-income housing.
