January 2020 California Rent Control

January 2020 California Rent Control

Legislature in California just passed a new Rent Control Bill. This new assembly bill No. 1482 is an “anti-rent” gouging rent control bill. State lawmakers are now laying down rent control because of the growing issues of homelessness, shortage of housing, and an ever-high poverty rate. Economists have argued that rent control causes issues buy capping the profits landlords can have and discouraging them to stay in the rental business. However, the purpose of this bill is to encourage builders to produce more affordable housing.

What does the bill mean?

Landlords are prohibited from raising rent on tenants over five percent plus the Consumer Price Index a year. The Consumer Price Index in California is on average 2.5 percent, so this increase of rent can average from 7-8% per year.

The consumer price Index is as follows:

  • Los Angeles and Orange Counties: 3.3%
  • San Diego County: 2.2% (as calculated March to March)

 (source: https://a17.asmdc.org/issue/ab-1482-frequently-asked-questions)

Therefore, if you live in San Diego, the rent can only be increased 7.2% per year.

On top of this rent control, before evicting tenants that have resided in a property for over a year, landlords must have a “just cause” to evict tenants. If landlords want to evict tenants for the purpose of renovating or building more properties, they must pay tenants a fee of one month’s rent.

Legal “just causes” include:

-not paying rent on time

-breaking a term or condition on the lease

-committing a “nuisance” at the property

-subletting the unit, against the terms on the lease

-not letting the landlord enter (must be for a lawful purpose, given 24 hour’s notices, and during regular business hours)

-committing a crime on property grounds

Illegal “just causes” include:

-the landlord wants to move into the unit, or a family member of theirs does

-the landlord plans to remove property from market

-the landlord plans to destroy or renovate unit

These reasons where the tenant is not at fault require a month’s worth of rent to be paid to the tenant.

Will the bill affect me?

If you currently rent is a location that does not already have a rent control law enforced, and your rental property is over 15 years old, then this new rent control bill does affect you. This law will apply largely to multifamily buildings and apartments.