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The California Tenant Protection Act of 2019 went into effect on January 1st, 2020, with some of the changes implementing over the next several months. The Tenant Protection Act of 2019 will extend a rent cap and eviction control to the entire state of California, specifically where rent and eviction control laws do not already exist. Below is a high-level overview of the top provisions. Many cities and counties already have established rent and eviction control legislation, and may remain unaffected by the new law. Check with your local housing authority to determine what laws and rights exist for landlords and tenancies. You can read the full California Tenant Protection Act of 2019 law text here.
Key Provisions:
Landlord shall not, over the course of any 12 months, increase the gross rental rate for a dwelling or a unit more than:
- 5 percent plus the percentage change in the cost of living1, or
- 10 percent, whichever is lower
Compared to the lowest gross rental rate at any time during the 12 months before the effective date of the increase.
- For a new tenancy, Landlords can establish any rental rate (not subject to increases) rental increase caps only apply to increases to existing tenants
- A tenant shall not enter into a sublease that results in a total rent for the premises that exceeds the allowable rental rate
- It is the intent of this legislation that this section should apply only for the limited time needed to address the current statewide housing crisis, likewise this law self-expires
Exemptions (that are not subject to these rent caps):
- A duplex in which the Landlord occupies one of the units as their primary residence
- Dorms/residence halls run by higher education institutions
- New properties that have been issued a certificate of occupancy within the last 15 years
- Low-income / subsidized housing
- Single-family homes that are not owned by corporations or business entities so long as a disclosure2 is provided by the tenant as to this exemption for all leases after July 1st, 2020
- “Percentage change in the cost of living” means the percentage change from April 1 of the prior year to April 1 of the current year in the regional Consumer Price Index for the region where the residential real property is located, as published by the United States Bureau of Labor Statistics. If a regional index is not available, the California Consumer Price Index for All Urban Consumers for all items, as determined by the Department of Industrial Relations, shall apply.
- “This property is not subject to the rent limits imposed by Section 1947.12 of the Civil Code and is not subject to the just cause requirements of Section 1946.2 of the Civil Code. This property meets the requirements of Sections 1947.12 (c)(5) and 1946.2 (e)(7) of the Civil Code and the owner is not any of the following: (1) a real estate investment trust, as defined by Section 856 of the Internal Revenue Code; (2) a corporation; or (3) a limited liability company in which at least one member is a corporation.”
Disclaimer: This blog is for informational purposes only and is published by TurboTenant. It is not legal, financial, or tax advice. Laws and regulations for landlords vary by state and locality and may change over time. Always consult a qualified attorney, accountant, or local housing authority before making decisions related to your rental property. The publisher and authors assume no responsibility for actions taken based on the information provided.
