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California will limit rent increases under bill signed by Gov. Gavin Newsom

Liam Dillon, Los Angeles Times on

Published in Home and Consumer News

OAKLAND, Calif. -- Millions of Californians will for the first time have new safeguards against large rent increases after Gov. Gavin Newsom signed legislation on Tuesday capping annual rent hikes for the next decade. The new protections come as major metropolitan regions across the state have seen double-digit increases in their homeless populations and residents have in recent polls cited homelessness and housing problems as the most pressing issues facing the state.

Newsom hailed Assembly Bill 1482 as the nation's strongest statewide renter protection measure, saying that tenants deserved relief from the state's soaring housing costs, which have threatened the ability to stay in their homes.

Under the new law, most yearly rent increases over the next decade will be limited to 5% plus inflation and tenants will receive protections against being evicted without cause.

California is the third state to have passed a significant expansion of renter protections this year. Oregon approved a statewide rent cap of 7% a year plus inflation, but unlike California, its law won't expire in 10 years. New York legislators boosted existing rent controls in New York City and allowed other communities in the state to implement the policy.

The law's signing also comes less than a year after California voters decisively rejected a ballot initiative that would have allowed cities and counties to impose stricter rent controls in their communities. Newsom, who opposed that initiative, subsequently called on lawmakers to pass measures that would provide some stability for tenants, leading to Tuesday's action.

Some 9.5 million renters -- more than half of California's tenant population -- are burdened by high rents, spending at least 30% of their income on housing costs, according to a recent estimate by UC Berkeley's Haas Institute for a Fair and Inclusive Society.

 

Had the rent cap been in place this year, rent increases in the Los Angeles area would be limited to 8.3% while those in San Francisco would have been capped at 9%.

There are a number of exceptions to the law's new rules. The rent cap will not apply to apartments built within the last 15 years or single-family home rentals unless they're owned by corporations or other institutional investors.

Limits on rent increases will not change for those currently living in rent-controlled apartments. But the new rules extend protections for renters living in newer complexes in cities with rent control. In Los Angeles, for instance, rent control limits increases to about 3% or 4% per year for those living in apartments built before October 1978. Tenants in buildings constructed between that time and 2005 will now see any increases to their rent capped under the new law.

The law, which will take effect on Jan. 1, also prohibits landlords from evicting tenants who have lived in an apartment for a year without proof of documented lease violations.

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