New Rent Control Law to Take Effect in California on Jan. 1, 2020

SACRAMENTO — California Gov. Gavin Newsom has signed a statewide rent control bill into law that aims to protect renters against price gouging and provide eviction protections. More specifically, Assembly Bill 1482 bars landlords from raising rents more than 5 percent plus the local inflation rate in one year. The annual inflation rate varies by region, but averages about 2.5 percent across the state.

AB 1482, which goes into effect Jan. 1, 2020 and runs through 2030, was part of a series of bills signed into law on Tuesday to protect tenants from discrimination as well as bolster and clarify their rights on a range of issues.

“About a third of California renters pay more than half of their income to rent and are one emergency away from losing their housing,” said Newsom. “One essential tool to combating this crisis is protecting renters from price gouging and evictions. The bills signed into law today are among the strongest in the nation to protect tenants and support working families.”

The rent cap would not apply to apartments built within the last 15 years. It would also not apply to single-family home rentals, unless corporations or other institutional investors own those properties.

Limits on rent increases will not change for those currently living in rent-controlled apartments, according to the Los Angeles Times. However, the new rules extend protections for renters living in newer complexes in cities with rent control. In Los Angeles, for instance, rent control limits the increases to about 3 percent or 4 percent per year for those living in apartments built before October 1978. Tenants in buildings constructed between that time and 2005 will now be subject to the statewide rent cap.

The State Assembly approved the bill in September by a margin of 46-22. The vote drew immediate criticism from the apartment industry.

“The most effective way to fix California’s housing crisis is by building more housing across a range of price points, and AB 1482 makes that harder to do,” said Douglas Bibby, president of the National Multifamily Housing Council, in prepared remarks issued Sept. 12.

“After Californians overwhelmingly rejected the rent control ballot initiative less than a year ago, lawmakers today went against their constituents by passing a measure that will discourage investment, shrink the availability of affordable housing that already exists and squeeze even more people struggling in the housing market,” added Bibby. “This makes the problem worse. The housing affordability crisis is real, real Americans are being harmed by it every day and we need real solutions — not restrictive policies that we know don’t work.”

— Matt Valley

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