As California’s housing landscape evolves, landlords must stay informed about the latest regulations. In 2023, Governor Newsom signed a remarkable 56 housing bills into law, many of which take effect in 2024. Here’s what you need to know about the changes impacting rental home owners in California.
Overview: What Landlords Cannot Do in California
Before diving into the new laws, it’s crucial to understand what actions are off-limits for landlords in California:
- Rent Increase Limits: The Tenant Protection Act restricts rent hikes to a maximum of 10% or 5% plus the CPI increase (whichever is lower) within a 12-month period.
- No-Fault Evictions: Landlords cannot evict tenants without a valid cause.
- Owner Move-Ins: If a landlord ends a tenancy to move back in, the unit cannot be re-rented for 12 months.
- Remodeling Evictions: Landlords must disclose plans for remodeling if terminating a lease.
- Security Deposit Limits: Security deposits are capped at one month’s rent, and landlords must provide an itemized list of any deductions within 21 days of a tenant’s move-out.
- Fair Treatment: Discrimination based on credit history, particularly against applicants with government rental subsidies, is prohibited.
- Application Fees: The maximum tenant application fee is capped at $62.02, adjusted yearly.
- Maintenance Obligations: Landlords must address maintenance issues, especially those affecting tenant safety.
Remember that city ordinances may provide additional protections, so be sure to check local laws as well.
5 Important Changes for 2024
1. Enhanced No-Fault Eviction Rules
Effective Date: April 1, 2024
New regulations require detailed justification for no-fault evictions related to owner move-ins or significant remodels. Landlords must:
- Move-in within 90 days after a tenant vacates.
- Remain in the home for at least 12 months before re-listing the property.
- Provide specific details about family member occupancy.
2. Security Deposit Cap
Effective Date: July 1, 2024
The new law caps security deposits at one month’s rent, significantly reducing upfront costs for renters. For instance, if rent is $2,500, the maximum move-in cost will be $5,000, which includes the first month’s rent and security deposit.
Exceptions apply for “small landlords” owning 1-2 properties, where a deposit up to two months’ rent may be permissible.
3. Protection Against Illegal Occupancy
Effective Date: January 1, 2024
Landlords can now notify local law enforcement of vacant properties to remove trespassers. The validity of trespass notices has been extended to 12 months, streamlining the eviction process.
4. New Screening Laws
Effective Date: January 1, 2024
Landlords must modify their tenant screening practices to avoid discrimination based on credit history for applicants receiving government subsidies. They must allow these applicants to provide alternative proof of their ability to pay rent.
5. San Francisco’s Empty Home Tax
Effective Date: January 1, 2024
Property owners in San Francisco with three or more vacant units for over six months will incur an annual tax ranging from $2,500 to $5,000 per unit. This measure aims to combat homelessness and improve housing availability.
Conclusion
The changes to California rental laws in 2024 significantly impact landlords and their management practices. Staying informed and adapting to these new regulations will be essential for maintaining compliance and fostering positive tenant relationships.