California Assembly passes state-wide rent control bill

California is on the path to joining Oregon in passing statewide rent control. AB-1482 passed the Assembly with 43 votes to 28. It would apply to most single-family residences which are not covered under local rent control regulations.

Following intense negotiations, the bill was relaxed slightly in favor of the property owners. Originally it was to limit rent increases to no greater than 5% per year (in addition to inflation). However, that cap was increased to 7%.

There are also a number of provisions which serve to slightly water down the bill. For one, it is set to expire in 2023. Due to an amendment added last week, it will not apply to properties less than 10 years old. Moreover, landlords that own 10 properties or less are exempt from these rent hike caps. It is said that the bill will undergo further modifications in the senate.

Additional protections for renters are being considered with AB-1481. This bill would essentially require that landlords provide just cause for terminating a renter’s lease, that they give notice prior to termination and moreover, that they be given an opportunity to reconcile the cause prior to outright termination. Beyond this, it would require that in the case of no-fault evictions, the landlord assist the renter in their relocation, in the form of a payment based on a specified formula.

Advocates for renter’s rights argue that the success of rent control requires the concurrent protections of AB-1481. This is based on the fear that landlords can circumvent rent controls by evicting current tenants to bring in new ones (rent control applies to the tenants and not the residence itself).

Not surprising, the groups that are against these measures are also those who stand to make less money as a product of their implementation. Opposition to the ballot-measure last year saw $80-million poor into campaigns which sought to convince renters that rent control would ultimately cause renter hardships. Their argument is that rent control leads to greater housing shortages by reducing the profit margins for landlords.

“This is a disincentive for people to build,” Assemblywoman Melissa Melendez (R-Lake Elsinore) said. “And what we need is to build.”

However, this point is pretty much entirely dismantled by the fact that the passed bill includes a provision that it does not apply to residences less than a decade old.

John Rosenbaum is an Orange County Personal Injury and Workers Compensation attorney that has successfully served southern California for decades. If you might be in need of legal counsel, contact our law offices today for a free, no obligation consultation.