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Rent Control Enforced for All Apartment Buildings in Los Angeles?

Rent control has become a hot topic in the last several months, especially in Los Angeles where rent control is widely enforced. To put in simpler terms, rent control is a law that limits the yearly increase of rent charged to a tenant in cities that have housing shortages. In Los Angeles, in particular, most apartment buildings built before October 1, 1978 are subject to a 3% yearly rent increase cap.

Currently, there is debate on appealing the Costa-Hawkins Rental Housing Act, which was put in place in 1995 to ensure no rent control on apartment buildings built after 1995, single family homes, and condominiums. It further ensures the deregulation of rents after a tenant moves voluntarily, allowing property owners to set new rent rates without the restriction of rent control.

With the repeal of the Costa-Hawkins Rental Housing Act, rent control on all apartment buildings regardless of the year built will be subject to rent control. This repeal will be a win for tenants fighting to keep costs low, but devastating to the apartment building industry as developers will have no incentive to enter the market. This will lead to more housing shortages.

Spearheaded by Assemblyman Richard Bloom, this repeal (formally known as AB 1506) is set to happen next year.

In preparation for the repeal, apartment owners should work to maximize the revenues on their apartment building by doing the following as soon as possible:

  • Increase rent by 3% every year if your property is rent controlled.

  • If your property is not rent controlled, increase rent to market value or higher

  • If there is a vacancy, increase rent to market rate before re-tenanting

  • Use the RUBS program or sub-metering to decrease the amount of money you pay for utilities

  • Increase rent if there are additional tenants that are not on the lease

Overall, apartment owners should be prepared for some type of change to the LA rent control law or the repeal of the Costa-Hawkins Rental Housing Act. If you have any questions please call or email. Subscribe to our page and we will update you with the latest on the rent control issue.


Interested in the rent control and learning ways to increase apartment building revenues? Read other related articles here!

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