If you own rental property in California, you’re probably already aware that the state has some of the most complex rental laws in the nation. Whether you’re managing a property in Los Angeles or somewhere else in the state, staying on top of these laws is crucial. Tenant protections are robust and frequently updated, meaning landlords need to stay informed to avoid costly mistakes.
Earnest Homes has provided a breakdown of some key rental laws you should be aware of, from new regulations to long-standing rules that have recently been updated.
1. Security Deposit Changes: What You Need to Know
One of the most significant changes to California’s rental laws is the update to security deposit limits. Starting July 1, 2024, landlords can no longer charge more than one month’s rent for a security deposit—no matter if the unit is furnished or not.
Exceptions:
Smaller landlords may still charge up to two months’ rent, but only if:
- The landlord is an individual or a small LLC (with only natural persons as members). ● The landlord owns no more than two rental properties, with a total of four units or fewer. (That means two single-family homes, two duplexes, or one home and a duplex, for example.)
But there’s an important caveat: If your tenant is a service member, you cannot take advantage of this exception.
Additionally, landlords must return the security deposit within 21 days of the tenant moving out and provide an itemized list of any deductions. You can deduct for unpaid rent, damages, and cleaning fees—but not for normal wear and tear.
2. Understanding Rent Control in Los Angeles
Rent control laws vary across California, but Los Angeles has some of the most specific and stringent rules. Under the Rent Stabilization Ordinance (RSO), rental properties built before October 1, 1978 (including apartments, condos, and even some townhomes or duplexes) are subject to rent control. The RSO impacts how much you can increase your rent. It also requires that your rental property is registered with the city
So, how much can you increase rent? That depends on the Consumer Price Index (CPI). In general, you can raise rent by 3-8% per year, but specific rules apply, such as:
- Between now and June 30, 2025, rent can go up 4%, plus an additional 1% if you pay for gas and another 1% if you cover the electricity.
- If your tenant vacates voluntarily or is evicted, you can increase the rent freely.
Statewide rent control laws also exist, which cover some properties not covered by local laws. These limits generally allow for a 5% increase in rent plus the annual CPI adjustment, but only once a year (or twice within a 12-month period).
Confused? Rent control can be tricky, so it’s worth checking in with a professional to determine if your property is affected.
3. Navigating Eviction Laws in California
Evicting a tenant in California isn’t as straightforward as in other states. Unless there’s a “just cause,” like nonpayment of rent, property damage, or illegal activity, you’re likely to face a complicated process. Even with just cause, you’ll need to follow strict procedures—serve notices, go to court, and potentially face a hearing.
Even if you don’t have a “just cause,” a no-fault eviction may still be possible if you’re planning to move into the unit or take it off the market to sell. However, this comes with a mandatory relocation fee (at least one month’s rent) to the tenant.
Pro tip: Don’t attempt an eviction without consulting with an experienced property manager or attorney familiar with California law.
4. Fair Housing Laws: What You Can and Can’t Do
California has some of the strictest Fair Housing laws in the country, adding several protections beyond the federal law. Here’s the list of protected classes under California law—make sure you don’t discriminate against tenants based on:
- Race, Color, or National Origin
- Religion or Creed
- Sex, Gender Identity, or Gender Expression
- Physical or Mental Disability
- Familial Status
- Age
- Sexual Orientation
- Veteran or Military Status
- Citizenship Status
- Primary Language
- Marital Status
- Source of Income (e.g., housing vouchers)
- Genetic Information
This list is constantly evolving, so it’s essential to stay updated on all federal, state, and local fair housing laws to avoid costly penalties or lawsuits.
Final Thoughts
With frequent updates and a patchwork of state, local, and federal laws, it can feel overwhelming to keep track of California’s rental regulations. But being proactive and informed will help you avoid violations that can cost you time, money, and stress.
If you’re unsure about any aspect of California’s rental laws, don’t hesitate to reach out for guidance. At Earnest Homes, we specialize in helping property owners navigate these legal complexities with confidence. Contact us today to make sure you’re compliant and staying ahead of the curve!
