AB-1482: The California Rent Control Bill

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AB-1482: The California Rent Control Bill

Category: Real Estate

Published 09/08/2019

What Is AB 1482?

Assembly Bill 1482 was introduced by District 17 Assemblyman, David Chiu. AB 1482 aims to create a statewide rent cap and establish “just cause” eviction standards.

Cities such as Berkeley, Oakland, and San Francisco have more restrictive local laws that take precedence over AB-1482. This law would mainly apply to cities without more restrictive local ordinances.

Currently, besides the Costa-Hawkins rent control act, California does not have any statewide rent caps. New amendments to the proposed bill would set a statewide rent cap of 5% (plus regional consumer price index (CPI)) over the course of any 12-month period until the year 2030; this affects the majority of California’s rental housing stock, including apartments and single-family homes. Furthermore, the bill prohibits property owners from terminating a tenancy without “just cause” when a tenant has been continuously and legally occupied a residential real property for 12 months.

For no-fault just cause terminations, the owner must either provide assistance for their tenants. This can either come in the form of a direct payment of one month’s rent to the tenant, or a written waiver of the final month of rent payment. Without assistance, the notice of termination is void.

Just Cause Evictions

Advent Properties highlights some of the more relevant stipulations that establish just cause:

At-Fault Just Cause

  • The tenant defaults on rental payment.
  • The tenant violates a material term of the lease after being issued a written notice to correct the violation.
  • The tenant maintains, commits, or permits the maintenance/commission of a nuisance described in paragraph (4) of Section 1161 of the Code of Civil Procedure.
  • The tenant does not execute a written extension or renewal of the lease after their written lease terminates on or after January 1, 2020.
  • The tenant commits criminal activity on the residential real property.
  • The tenant assigns or sublettes the premises in violation of the tenant’s lease.
  • The tenant refuses to allow the owner to enter the premises as authorized by Sections 1101.5 and 1954 of this code, and Sections 13113.7 and 17926.1 of the Health and Safety Code.
  • The tenant fails to vacate the property after the tenant provides notice to terminate the tenancy.

No-Fault Just Cause:

  • The owner of the real property owner, their spouse, domestic partner, or direct family intends to occupy the real residential property.
  • Withdrawal of the residential real property from the rental market.
  • Owner compliance with local ordinances/government agencies that would require the vacancy of the property.
  • Plans to demolish or significantly remodel the property.

Should the tenant fail to vacate the real residential property after the notice to terminate the tenancy expires, the owner may recover the relocation assistance/rent waver as damages.

What Does This Mean For Property Owners?

As AB 1482 is applicable to nearly all of California’s rental housing stock. The restrictive rent caps and just cause eviction standards may disencourage small property owner from entering the rental market.

The bill prohibits owners from “pass throughs” for simple repairs such as a leaky roof. As the owners have no way to offset these repair costs, the restrictive rent caps may negatively impact small property owners.

Furthermore, small property owners will have to absorb the costs of tenant evictions in no-fault case terminations.

For clarifications on how AB 1482 may influence you and your property, feel free to contact Advent Properties at 510.500.7531 or dglass@adventpropertiesinc.com

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