Q&A with the Apartment Association – May 2023 Update

In a recent interview with Oliver John Baptist, the educational coordinator for the Apartment Association of Southern Cities, Juan Huizar explores the current concerns and queries of landlords in the rental market. Oliver sheds light on the most popular topics that landlords are grappling with, including rent increases.

We highly recommend watching the entire video interview, especially if you self-manage your investment property. The following is a brief summary of the interview, but to gain a comprehensive understanding, we encourage you to view the complete discussion.

What is the current rent increase situation in Long Beach?

During the Covid period in Long Beach, landlords were allowed to raise rents as long as they were within the requirements of AB 1482. However, it was suggested not to raise rents on tenants who were deferring rent payments.

Currently, the maximum rent increase in Long Beach is based on the previous year’s April CPI, capped at 10%. However, the new CPI to be released on May 10th will determine the new maximum rent increase. It’s possible that the new rent cap could be below 5%.

How have rent control regulations changed?

Approximately 400,000 new units that were previously not rent-controlled are now subject to rent control regulations. There is a rent threshold for single-family homes, and tenants must owe rent above that threshold before landlords can serve a notice. Landlords in LA City should visit lahd.org for detailed information and utilize eviction cover sheets when serving notices.

Can landlords in Los Angeles raise rents? 

It depends on whether the property falls under the Rent Stabilization Ordinance (RSO). Landlords should check the HUD website for fair market rents and also visit lahd.org to determine if their property is under RSO. Rent increases are prohibited on RSO properties in Los Angeles until January 31st, 2024.

What are the difficulties faced by landlords due to regulations? 

Properties in South LA that are subject to rent control regulations face difficulties in selling. The demand is lower, and these properties often sit on the market for longer periods of time, resulting in lower selling prices.

Can landlords move into their own property?

Landlords in Long Beach who want to move into their own property should first check if the tenant owes rent prior to March 31st, 2023. If rent is owed, the tenant has 12 months to repay. There are no-fault protections for tenants, and landlords must pay relocation costs.

Additionally, landlords should give notice to tenants, check if rent is owed, and abide by the rules of the Tenant Protection Act. They should also provide an additional notice to the county of Los Angeles, stating their intention to move in, paying the proper relocation payment, and following guidelines for special circumstances such as lower income or elderly tenants.

Key Takeaways 

  1. Rent increases: Many landlords have deferred rent increases during the moratorium period, but now they are trying to make up for lost ground due to rising costs, such as energy bills.
  2. Repossession of properties: Landlords who have not reclaimed their properties during the moratorium are looking to regain ownership for various reasons, including owner occupancy or renovation.
  3. Rent increase regulations in Long Beach: Despite the COVID period, landlords were allowed to raise rents as long as they followed the requirements of AB 1482. The maximum rent increase is capped at 10% based on the April Consumer Price Index (CPI), but this may change based on the new CPI released on May 10th.
  4. Rent control in Los Angeles: Rent increases in Los Angeles depend on whether the property falls under the Rent Stabilization Ordinance (RSO). Landlords should check the LA Housing Department’s website to determine if their property is subject to rent control.
  5. Eviction cover sheets: In the city of Los Angeles, a specific eviction cover sheet must accompany eviction notices, whether for non-payment of rent or other violations. Landlords should refer to the LAHD website for more information.
  6. Relocation costs: If a landlord intends to move into their own property, there may be additional costs involved, such as higher relocation amounts and no-fault protections for tenants.
  7. Process for moving into own property: Landlords must follow the notice requirements and give notice to both the tenants and the county of Los Angeles. The process is similar to that under the Tenant Protection Act.
  8. Considerations for property sale: Properties in South LA subject to rent control regulations may be more challenging to sell due to reduced demand and longer market times.
  9. Expansion of rent control: LA City has expanded rent control to include previously exempt properties, such as single-family homes, based on rent thresholds determined by fair market rents from HUD.

Please note that every city in California may have its own rent increase limitations and rent control ordinances.

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