At New Bridge Management, it’s our job to keep up with changes in the real estate and property management landscape. We work with owners and investors throughout the Central Valley, and we know it’s important that you’re aware of how the laws that affect you are changing.
For example, the new rent control bill that was approved by the legislature and signed by the governor will go into effect in January 1, 2020. There are a few things you need to know.
Rent Control Laws in California
Recently, rent control has been the topic of conversation for everyone involved in California real estate. In California, our economy has been prosperous for a long time. We’re the fifth largest economy in the world, based on our gross domestic product. If California was a country instead of a state, it could stand alone on the strength of its economy.
With so much prosperity come lot of challenges.
Affordable housing is one of those challenges that has plagued California for a long time, especially it’s most populated cities. Everyone has been talking about the shortage of housing. This has impacted the rental market, and as a result, on October 8th, 2019, Governor Newsom signed Assembly Bill 1482 into law.
With that, state-wide rent control was created.
Understanding the Tenant Protection Act of 2019
The bill that established statewide rent control is called the Tenant Protection Act of 2019. It creates and enforces rent control for a lot of rental properties within the state. It also put into effect just cause eviction rules and anti-price gauging laws.
This law will go into effect as of January 1st, 2020 and it will sunset on January 1st, 2030. So, this law has a period of 10 years, and we’re not sure what will happen between now and 2030. There are three specific things that this law did to impact the housing situation in California:
- Creates rent caps throughout the state for a lot of different properties.
- Creates a just cause eviction requirement, which also impacts many of the state’s rental properties.
- Solidifies anti-price gauging laws.
What the Law Means for You
The extent to which this law impacts your life as a landlord and rental property owner depends on the type of rental homes you own. While it’s a statewide rent control law, many properties have been excluded or are exempt. For example, single-family homes owned by a private individual rather than a corporation or institution may be exempt. However, you may still be bound by the just cause eviction part of the law. You need to educate yourself completely on this law, or talk to a property manager so you know exactly how it impacts you and your properties.
This is a brief summary of the rent control laws or Tenant Protection Act of 2019. We are here to keep you informed and updated. Keep watching some of our other blogs, and we’ll talk in more detail about what this law means for you. If you have any questions, please contact us at New Bridge Management, and we’ll happily help.