Rent increases aren’t popular amongst tenants, but they’re an important tool for landlords looking to keep up with inflation or adjust to ever-changing market conditions. However, there are cases where how much and how often you can raise rent are limited – especially in Los Angeles, where both state and local laws provide rent control protection for tenants.
If you’re a landlord looking to get fair market value for your Los Angeles rental property, keep reading to learn your rent increase limitations.
The Different Rent Control Laws You Need to Know
Rent control laws in Los Angeles are designed to protect tenants from excessive rent increases while still allowing landlords to earn a fair return on their property. There are two main rent control regulations categories you need to know: California’s Tenant Protection Act (AB 1482) and local rent control laws specific to Los Angeles.
Tenant Protection Act (AB 1482)
California’s Tenant Protection Act (AB 1482), enacted in 2019, is a statewide law that caps annual rent increases for most residential properties. Under this law, rent can only be increased by 5% plus the local rate of inflation, or 10% of the current rent, whichever is lower. This law applies to properties that are more than 15 years old and includes protections like “just cause” eviction standards.
However, not all properties fall under AB 1482. Single-family homes and condos are generally exempt unless they’re owned by a corporate entity or a real estate investment trust (REIT). Properties built within the last 15 years are also exempt from this law.
Local Rent Control Regulations
In addition to AB 1482, Los Angeles has its own rent control measures through the Los Angeles Rent Stabilization Ordinance (RSO). This ordinance offers more stringent protections for tenants living in buildings constructed before October 1, 1978. The RSO limits how much a landlord can increase rent and outlines specific rules for rent adjustments in rent-controlled properties.
For example, under the RSO, landlords must follow set guidelines regarding rent increases and how often they can be applied. These limits are often lower than what is allowed under AB 1482, and landlords should be familiar with both state and local regulations to ensure they remain compliant
How Often Can Landlords Increase Rent in Los Angeles?
The frequency and amount of rent increases in Los Angeles depend on the property type and whether it is subject to rent control. In general, rent increases are allowed once every 12 months for properties governed by rent control laws. However, the amount that rent can be increased varies.
For rent-controlled units under the Los Angeles Rent Stabilization Ordinance (RSO), the city has imposed limits on how much rent can be increased, especially in the wake of the pandemic.
As of April 1, 2023, landlords are allowed to raise rent by a maximum of 3% for most rent-controlled properties, including fully-covered rental units and mobile homes.
If the property is considered luxury, rent increases are capped at 5%. These restrictions are in place until December 31, 2024, per the Residential Stabilization Program Ordinance (RSTPO), Chapter 8.52.
For properties not covered by the RSO but subject to AB 1482, landlords must follow the state’s guidelines. This means rent can be increased once per year, with the increase capped at 5% plus inflation, or 10%, whichever is lower. It’s important to note that these regulations vary based on the type of property and its inclusion under local or state laws.
What Types of Properties are Included in Rent Control?
Not all properties in Los Angeles are subject to rent control, which can make understanding the rules more complex. Generally, properties built before October 1, 1978 and those covered by the RSO fall under strict rent control guidelines.
Properties built after this date, single-family homes, and condos are often exempt from local rent control regulations. However, these may still be subject to AB 1482 unless they meet specific exemptions, such as being owned by individuals or entities not classified as corporate landlords.
Mobile homes in Los Angeles are also covered by rent control laws, meaning they are subject to the same annual rent increase caps as other rent-controlled properties.
How Much Notice Do LA Landlords Have to Give When Increasing Rent?
When raising rent, landlords are required to provide tenants with advance notice. The amount of notice depends on the percentage of the rent increase.
- For rent increases of 10% or less, landlords must provide tenants with at least 30 days’ written notice.
- For rent increases greater than 10%, landlords are required to give 90 days’ written notice.
The notice must be delivered in writing and comply with local and state guidelines, ensuring that tenants have adequate time to prepare for the financial changes.
It’s also worth noting that if the rent increase violates rent control laws, tenants have the right to challenge it, often through local housing authorities or legal action.
Wrapping Up
Understanding rent increase laws in Los Angeles is crucial for legally maximizing your rental income without incurring costly penalties.
As a landlord, you must comply with a mix of state and local regulations that impact:
- The amount you can raise rent by
- How often raises are allowed
- How much notice tenants must receive
Failing to follow the guidelines can lead to lawsuits and significant fines as well as civil penalties, so it’s essential to stay up to date on rent control regulations to protect your investment.
Navigating these rules can be complex, but staying informed will help ensure a fair and legal process for everyone involved. If you’re considering a rent increase, understanding the key rent control laws and regulations in Los Angeles is vital to stay compliant and maintain your cash flow.
Need help navigating the complex Los Angeles rental market? Get in touch with an agent today.