Everyone in the California real estate industry is talking about rent control.
There are many communities in the state that already have rent control laws on the books, but statewide rent control is coming. It’s gaining a lot of traction in the state legislature and the governor will be willing to sign a rent control law that reaches his desk.
We want to help you, as a landlord in Healdsburg, to prepare for both rent control and just cause evictions.
What Rent Control May Mean for You
Currently, Healdsburg landlords are already following a rent control law that went into place after the fires of 2017 and 2018. After those wildfires triggered a huge depletion in the inventory of affordable housing, landlords were prohibited from raising the rent more than 10 percent of what it was before the emergency was declared in October of 2017. So, if your rent was $3,000 per month at that time, you have not been able to raise it more than $300.
This may seem unfair, but the law was put into place to protect tenants from greedy landlords who understood the low inventory and wanted to maximize rents to cover the cost of their rising insurance premiums.
Statewide rent stabilization is a little different. Under the rent control laws currently being considered, landlords would be able to raise the rent a maximum amount, which would be set by the legislature. The Consumer Price Index (CPI) would also be allowed for. So, maybe the rent control law would say you can only raise rent seven percent. Then, the CPI would be set at 2.5 percent, which means you cannot raise you rent more than 9.5 percent, total.
There are a lot of exceptions and there will likely be a lot of debate. We are following the changes in the law closely, and we’ll be sure to update you as soon as there’s a reason to share additional information. For now, be prepared to stay at around the 10 percent limit for rental increases.
Just Cause Eviction Laws
Rent control laws seem to be going hand-in-hand with just cause eviction laws. While no-fault evictions have been fairly common, the law is changing to limit the reasons that a landlord can evict a tenant. Under the statewide law currently being considered, you can only evict a tenant for:
- Nonpayment of rent.
- Causing a nuisance in the property or the neighborhood.
- Engaging in illegal activities in the property.
These are generally the only reasons you would evict a tenant anyway. But, what if you want to move into the property yourself at the end of the current lease term? What if you have a friend who needs a place and wants to rent yours? There are some implications in the just cause eviction laws that you’ll need to sort out as a landlord.
We are here to help. As experienced Healdsburg property managers, we are prepared to help landlords and investors navigate the current and coming laws that affect them and their rental property. Contact us at Healdsburg Property Management if you have any questions.