California has officially passed a statewide rent control law. This is a big deal for San Diego County, which has never had any form of rent control before now. According to Assembly Bill 1482, the rent cap will start on January 1st, 2020. 

With this new law coming into effect landlords and renters should know how this will impact them. Here are a few major things to know.

Rent is capped

This doesn’t mean that the landlord can’t raise the rent, but it does limit the amount they can legally raise it. Rent increases in any 12-month period will be limited to 5% plus the inflation rate. The inflation rate is based on the California Consumer Price Index published by the state’s Department of Industrial Relations. This rate can change, but as of now it is set at 2% for San Diego. So as of January 1st, the most a landlord can raise the rent would be 7% for the year.

This law applies to tenants with leases and month-to-month agreements. Once a tenant leaves a rental unit the landlord will be able to raise the rent to market rate even if it is over the 7% increase.  

There are exemptions

Not every rental is covered by the new law. Single family homes, condos, owner occupied dwellings, deed restricted housing, and housing built within the last 15 years (not owned by a corporation) are all exempt from rent control. If a renter falls into one of these categories, they should receive a form from the landlord that states the exemption.