Are you a new or accidental landlord in San Diego? Owning a rental property may seem like an easy, straightforward, and passive occupation at first.
The truth is that your property is subject to federal, state, and local laws, and many landlords break laws without even realizing it. In 2024, one of the most important laws San Diego landlords need to be aware of is rent control.
What are the latest San Diego rent increase laws? Do they apply to your property? What are your legal obligations when it comes to notifying tenants about rent increases?
Read on as we share everything you need to know about rent increases in San Diego.
Are There Local San Diego Rent Increase Laws?
A handful of California cities have their own rental increase laws that supersede state rent control efforts. However, San Diego is not currently one of them.
In recent years, city legislators have discussed adopting city-wide rent control laws. While they’re not currently in effect (and nowhere near completed), this is something to keep an eye out for in the future.
Until then, qualifying San Diego landlords need to follow the laws under AB 1482, which went into effect in January of 2020. AB 1482 expires in 2030, when state legislators will either extend or change it.
How AB 1482 Limits Rent Hikes
Prior to AB 1482, there were no statewide rent control laws on the books in California. The goal of AB 1482 is to increase tenant rights and protect tenants from unmanageable housing inflation. However, the laws are lenient enough that landlords also maintain some protection against inflation.
Under AB 1482, landlords can increase rent by a rate of:
- 5% of the current rent plus the local rate of inflation, or
- 10% of the current rent
You must choose the lowest of the two. In other words, if the local rate of inflation is less than 5%, you would use the first model. If the local rate of inflation is more than 5%, you would use the second model.
You may only increase rent at the end of a lease term, which is typically 12 months.
How to Calculate Rent Increases Under AB 1482
Start by assessing the current local rate of inflation. You can find this information through the California Consumer Price Index (CPI), which is updated annually.
Let’s say that your current rent price is $2,000 and the most recent CPI for San Diego is 2%. In this case, you can increase rent by a maximum of 7%, which is $140, bringing your rent price to $2,140.
If the most recent CPI for San Diego is 6%, you will need to use the second model, increasing rent by a maximum of 10% or $200. This would bring your rent price to $2,200.
Who Is Exempt From AB 1482?
Not all property types have the same legal obligations. Some examples of properties that aren’t beholden to AB 1482 rent control laws include:
- Properties built before January 31, 1995
- Owner-occupied duplexes
- Condos and single-family homes not owned by REITs or corporations
- Short-term rentals
- Student housing
Government-subsidized and affordable housing also fall under different regulations. Note that if you have new tenants moving in, you can establish the initial rate of rent to charge and do not have to abide by AB 1482 limits.
How to Let Tenants Know About Rent Increases
In addition to limiting rent increases, California state law dictates how and when landlords need to let tenants know about rent increases. This gives them time to decide if next year’s rent collection will fit into their budget. Here’s a quick look at how to properly let tenants know that you’re increasing the rent.
Get the Timing Right
Timing is the most important consideration when you’re operating within state laws. You need to let tenants know about rent increases:
- 90 days in advance for increases over 10%
- 60 days in advance for any increase for tenants who have resided in your property for one or more years
- 30 days in advance for month-to-month renters who have resided in your property for less than one year
- 30 days in advance for all week-to-week renters
If your property falls under AB 1482 laws, you will almost definitely need to provide a 60-day notice of rent increases of any amount. Note that you can’t increase rent in the middle of a lease. All increases must occur at the start of a new or renewed lease.
Include the Right Information
You should provide written notice to your tenant that includes the following information:
- The current rent amount and the new rent amount
- The effective date when rent increases to the new amount
- Payment details (how tenants can pay rent, particularly if you are making any changes to your rent collection process)
- Contact information for questions and concerns
You must deliver this information when tenants have the option not to renew their lease without penalty. In other words, you can’t ask a tenant to renew their lease and let them know at a later date that once that new lease begins, they’ll need to pay more in rent. To keep things simple, we encourage landlords to send along the information about rent increases along with the new lease agreement, which they can then sign if they so choose.
How Does AB 1482 Impact Section 8 Housing?
What if you have opted into the Section 8 housing program? As we mentioned earlier, government-subsidized and affordable housing don’t fall under AB 1482. However, there are other regulations you need to be aware of.
When you want to raise rent for a Section 8 property, you need to submit your rent increase proposal to the San Diego Housing Commission. Make sure to submit this proposal a minimum of 60 days before the increase goes into effect. The SDHC will let you know if they approve or deny your request and why.
Stay Compliant: Call NLPM for San Diego Property Management
San Diego rent increase laws currently fall under AB 1482, a statewide law that limits both rent increases and evictions. If you’re struggling to keep up with your landlord responsibilities or tenant rights, it’s time to call in the professionals.
Next Level Property Management has the experience to ensure compliance with all relevant laws and regulations, from HOA bylaws to local legislation. Contact us for full-service property management with a compliance-first approach.