Things You Need To Know About The New Rent Control Laws In California

There’s no denying the fact that the average rent in California was rising alarmingly, albeit steadily, over the past few years. With almost half of California’s residents being renters, the state’s cities were becoming some of the most expensive ones in the nation. Since the high rents were driving middle- and low-income residents away from California, the state implemented new rent control laws to retain the residents and solve the affordable housing crisis. While the new rules came into effect from 1st January 2021, landlords and homeowner’s associations had until 1st July 2022 to make the changes as per the new legislations. Here’s everything you need to know about these California rent control laws.

What Is Rent Control?

Rent control is a regulation that puts a cap on the rental rates as well as annual rent increases within a city or state. The main aim of rent control is to provide affordable living costs and conditions to lower-income residents.

What Do California Rent Control Laws Mean For Landlords?

Wondering how much can a landlord raise rent in California 2022? According to the new laws, the residential landlords in California cannot increase the rent of their properties by more than 5% annually, plus the local cost-of-living adjustment (inflation) of less than or equal to 5%, for a total maximum increase of 10%. To understand the latter part of the statement, let’s take an example. If the inflation rate in San Diego or Oakland reaches 7%, landlords in these cities would still have to consider only 5% cost-of-living adjustment and thus would be able to increase the rent by a maximum of 10%.

Along with this, the California rent increase laws also prohibit landlords and property owners from increasing the rent more than twice a year. Since they are allowed to increase the rent in the duration between two tenancies, landlords can also not evict residents just so that they can increase the rent; the law protects tenants from eviction without cause. In case if the owners themselves are moving into the residential property, or if they want to undertake a major renovation or demolition project, they need to pay the residents a relocation fee and then ask them to vacate the premises. 

What is important to note is that while the new California rent control laws have been implemented across the entire state, cities which already had their own rent control policies will keep following those policies. The new law will not override their existing policies. Examples of such cities include Beverly Hills, San Francisco, Inglewood, Mountain View, and Los Angeles.

Properties That Are Subject To The California Rent Control Laws

The rent control laws are applicable to rental units such as apartments and multi-family homes. But not all residential rental properties in California are subject to these legislations. Such properties include:

• New buildings which are not yet 15 years old. This is due to the Costa-Hawkins Rental Housing Act.  So, if apartments for rent in California are not older than 15 years, the new rental law will not be applicable on them. 
• Owner-occupied buildings with less than three or four units (the number depends on the local regulations)
• Detached accessory dwelling units, also known as ‘granny flats’ or ‘mother-in-law units’.
• Government-subsidized housing units
• Short-term rentals such as Airbnb
• Single-family homes and condos
• Owner-occupied duplexes

Manage Your Rental Properties With BFPM

Did you know that California is the second state to pass the rent control law? While the first one was Oregon, there are several other states such as Nevada, Washington, and Colorado, which intend to pass statewide rent control laws too. We at Beach Front Property Management save you the hassle of traversing through the intricacies of ever changing laws and legal formalities by assisting you every step of the way. So, for any property related guidance, feel free to schedule a 15 minute consultation call with Beach Front Property Management experts.