Rent Control Laws Brentwood Los Angeles – A Landlord’s Guide
As of January, 31, 2024, after 4 years of no increases, landlords will be able to raise rent within the limits that are set by the RSO. However, notices must reach tenants before this date to be valid.
Rent control laws in the city of Los Angeles have been a hot topic of discussion for both landlords and property owners. In California, the Rent Stabilization Ordinance (RSO) controls rent increases with the purpose of providing tenant protections.
For landlords in areas such as Brentwood, local laws concerning rent-controlled property, can present many challenges. The rising costs of maintaining properties, along with other expenses, make it difficult for landlords to manage profitability while adhering to the limitations of rent control laws.
Additionally, for property owners who wish to invest in apartments in Los Angeles, the restrictions on allowable rent increases could impact their decisions concerning investment calculations and returns.
If you are a landlord or property owner, it is essential to familiarize yourself with the provisions that are outlined in the RSO to ensure that you are compliant with the city’s rent stabilization ordinance rules.
To help you fully understand the maximum allowed rent increase for areas such as Brentwood and other cities in Los Angeles, we look at applicable rent control regulations and eviction protections. Additionally, we explore the Los Angeles County RSO and what it means in the rental market.
What Landlords and Property Owners Should Know
Understanding rent control rules can help you better protect your investments, remain compliant with local law, and uphold the rights of renters. The latest RSO regulation brings much relief for landlords and property owners by making provisions to increase rent and proceed with formalities such as tenant eviction or lease termination. It is important to note that all buildings constructed on or before October 1st, 1978, are included in the RSO.
According to the Los Angeles Housing Department (LAHD), tenants are required to pay outstanding monthly rent as of April 1st, 2023, and are no longer covered by the COVID-19 eviction protections.
If you are concerned about outstanding rental debt, looming evictions and property vacancies as RSO changes are implemented, feel free to reach out to the property management team at Lotus West Properties. With more than two decades of unmatched experience in the Los Angeles real estate market, we can assist with the latest information concerning the RSO and rent increases in California. Let’s take a brief look at the latest rent control rules in the remainder of this guide.
Rent Stabilized Ordinance (RSO) – A Brief History
According to the city’s housing department, if you own property in LA, it could be subject to the RSO. The RSO was passed in 1978 to protect tenants from exorbitant increases in their monthly rent. These increases were dependent on the Consumer Price Index, or CPI, of 3% to 8%.
In 1995, rent control laws such as the Costa Hawkins Act exempted condos, new apartment buildings, and single-family homes from rent control. Despite the repeal of this regulation by the Affordable Housing Act, Costa Hawkins remains in effect today.
A lack of housing affordability in California prompted the release of additional laws to control rent and protect tenants from evictions. One of these bills was the California Tenant Protection Act, or AB1482, which took effect on January 1st, 2020.
Today, the RSO aims to oversee rent hikes while protecting the rights of residents by preventing landlords from issuing increases that many renters cannot afford. Other rent control laws that have come about in the county due to the RSO include the JCO that we discuss below.
State Rent Control AB1482
The state law, AB1482, applies to the entire state of California, in which increases in rent are limited and a landlord is not permitted to end a tenancy without “just cause.” In terms of rent increases, this law permits annual rent hikes of 5% plus the CPI or 10%; the lower rate will apply.
Only units that do not fall under the RSO are subject to AB1482. It does not replace the RSO for tenant protections and qualifying rent-controlled units.
Just Cause Ordinance (JCO)
Buildings or rentals, including apartments, built after October 1st, 1978, that are not subject to the RSO, will be covered by the JCO for eviction protections. The purpose of the JCO is to protect the rights of renters from unlawful or unjust eviction by their landlord.
What is Covered By the RSO?
Whether you are taking on a new tenant or addressing outstanding rental debts, understanding the RSO can protect your financial interests and uphold the rights of tenants. This can prevent costly and often complicated legal issues owing to matters such rent increases outside of RSO requirements.
The RSO permits annual rent increases, and it allows property owners to register rental units. Furthermore, this regulation provides landlords with “just causes,” or lawful reasons for eviction.
Just Causes for Eviction and Relocation Assistance
A summary of the RSO’s just causes for lease termination:
- Tenant nuisances and unit damage.
- Failing to pay rent.
- Violating the terms of the lease.
- Preventing the landlord from having reasonable access to the unit.
- A renter accepting subtenants without approval.
- Illegal activity in the unit.
Should you wish to pursue a no-fault eviction, you must adhere to California’s relocation assistance program. This benefit requires that a landlord pay relocation fees for qualifying tenants, such as those with disabilities or persons over the age of 62, at the time of issuing the notice of termination.
The RSO includes rules for managing interest on security deposits and disclosure notices for buyout agreements.
If you are unsure about regulations involving a rent-controlled apartment or “just causes” for eviction, the professional team at Lotus West is here to help you. We manage more than 500 units in Los Angeles, including Brentwood, and understand how overwhelmed our clients feel over ever-changing rent control laws. For landlords, property owners, and tenants, we assist with expert advice concerning rental procedures.
The Los Angeles RSO and the Interplay with the Covid Moratorium
Los Angeles is a vibrant city known for its beautiful beaches, desirable climate, and attractive property market. Investment properties and multi-family homes in areas such as Brentwood, are highly sought after due to the excellent schools, entertainment, and economic stability.
With rental housing in high demand in the city of Los Angeles, the issue of rent hikes and the availability of affordable rental units has remained a nationwide concern for many years. The need for a stable rent market prompted the RSO to provide some level of protection for tenants by regulating large rent increases in rent-controlled units.
In response to the COVID-19 pandemic, regulations such as the California COVID-19 Tenant Relief Act of 2020 were released, in which landlords were prohibited from evicting tenants who were struggling to pay their rent because of COVID-related financial difficulties.
The Impact of the COVID-19 Moratorium
For landlords, working through rent control rules has made it hard to remain profitable. While regulation is required to protect tenants from exorbitant rent increases or homelessness due to unfair evictions, the restrictions on rent increases in light of rate hikes and worldwide economic uncertainty, have compromised investments.
The Los Angeles City Council has continued to implement restrictions on processes such as setting rents, terminating a lease, or performing property improvements.
On top of this, the COVID-19 pandemic led to moratoriums on the ability to raise rents and evict tenants. The moratorium aimed to prevent a surge in homelessness and maintain stability in the rental market during a time of crisis. But the extension of the moratorium prevented rent collection and evictions, affecting the livelihoods of many property owners.
When Does the Rent Increase Come Into Effect?
To address the ongoing frustration of landlords, while managing tenant rights, the city’s housing department issued an ordinance on June 2nd, 2023, to officially proceed with RSO rent increases.
Currently, the allowed increase is 7% rent plus 1% each for gas and electric.
Landlords will not be able to claim a retroactive rent increase in Los Angeles and rent may only be increased once every year.
Rules for Properties Not Covered By the RSO
If the RSO does not cover your rental property, then it could fall under the new state law. According to AB1482, older buildings that were constructed over 15 years ago may be subject to rent hikes of 10 percent.
Final Thoughts
Rent control laws in Los Angeles may pose challenges for landlords and property owners, but as you come out the other side of Covid Moratoriums, rent increases and the handling of evictions and vacant properties will affect the future of the greater Los Angeles rental market. It will be shaped by how well these regulations are navigated and adapted to changing circumstances.
The city will need to carefully assess how to transition from the former emergency measures to a sustainable and fair rental market.
Striking a balance between tenant protection and landlord viability will remain a priority for ensuring a stable housing market while protecting the most vulnerable residents of Los Angeles.
As the situation evolves in West Hollywood, our property managers at Lotus West will be helping current clients with increase notices and handling tenant evictions. Our proximity to the area means we are entrenched in the local community (Santa Monica, Malibu and West Hollywood, among others) and understand the impact of these changes on the local market. Join other satisfied clients across the Los Angeles area by giving us a call today!
