Working With AB 1482: California’s Rent Cap Law

On January 1, 2020, AB 1482 took effect, establishing a statewide rent cap law in California. The bill also provides “just cause” eviction protections for tenants. So, what does this mean for landlords? I wanted to take a moment to highlight some of the critical information for those who need to work with AB 1482.

First off, it applies to many residential properties throughout the state, but not all—more on that in a bit. From a high-level view, AB 1482 means that landlords cannot increase rent more than 5% plus the “percentage change in the cost of living (CPI)” over any 12-month period. For any rents that have been increased by more than what was allowed since March 15, 2019, AB 1482 required that these rents be rolled back on January 1st of this year.

As it relates to “just cause,” once a tenant or tenants have lived in the unit for a specified timeframe, the landlord cannot terminate a month-to-month tenancy, nor can they elect not to renew fixed-term leases unless there is “just cause” for eviction.

So, which properties are exempt from AB 1482? It does not apply to most single-family homes and condominiums, housing built within the last 15 years, and most properties subject to local rental control and “just cause” eviction ordinance. That said, it’s essential to determine if your property is covered by AB 1482 because, if so, you need to provide mandatory disclosures to your tenants.

There is a great tool available online here where you can determine if your property is governed by AB 1482. You will need to register as a guest, but after that, just answer a few questions, and you will be on your way to learning whether or not AB 1482 applies to your property and receive supporting documents to assist with notices etc.

If AB1482 does apply to your property, disclosures must be provided for this exemption. If the tenancy starts or renews on or after July 1, 2020, the notice must be provided in the rental agreement. CAA has created forms to allow landlords of these properties to provide proper notice.

If you have any additional questions about AB 1482, or about the Pasadena real estate market, please contact me. I have been working locally for many years, and I love to lend my expertise. Whether you’re buying or selling, I would love to speak with you!