California Rent Increase Laws

Is there a rent increase limit in California? 

The California Tenant Protection Act (AB 1482) caps rent increases at 5% plus CPI or 10%, whichever is lower (Cal. Civ. Code § 1947.12). And if tenants stay in a unit for more than 12 months, state law prohibits landlords from raising rent more than twice in 12 months (Cal. Civ. Code § 1947.12).

Local Rent Control Ordinances

Beyond state-level rent increase laws in California, many cities and counties set their own rent control rules. Here are a few examples:

Alameda: Local law caps rent increases for most multi-unit properties at 70% of the CPI change (Alameda, Cal., Mun. Code § 6-58).

Berkeley: Landlords can’t increase rent by more than 65% of the CPI change, up to 5% (Berkeley, Cal., Mun. Code § 13.76).

Beverly Hills: You can’t raise rent by more than the greater of 3% of the current rental rate or the CPI’s percentage increase over the last year (Beverly Hills, Cal., Mun. Code § 4-6).

Los Angeles: The city sets an annual rent increase cap based on the CPI (Los Angeles, Cal., Mun. Code § 151).

Oakland: Local law caps rental increases at the City Council’s annual permissible rate (Oakland, Cal., Mun. Code § 8.22.060).

San Francisco: You can raise rent by up to 50% of the CPI, but no less than 4% of the tenant’s base rent (San Francisco, Cal., Admin. Code § 37.1.6).

Santa Ana: Landlords can’t raise rent by more than 3% or by 80% of the local CPI change, whichever is less (Santa Ana, Cal., Mun. Code § 8-3140).

Santa Monica: Local law prohibits rent increases exceeding the lesser of the CPI plus 5% or 10% (Santa Monica, Cal., Mun. Code § 4.36).

West Hollywood: You can only increase rent by 75% of the change in CPI during the previous 12 months (West Hollywood, Cal., Mun. Code § 17.36.020).

However, the Costa-Hawkins Rental Housing Act exempts single-family homes, condos, and units built after February 1, 1995, from local ordinances (Cal. Civ. Code § 1954.50–1954.535). To understand how rent control laws work in your city or county, check your local California rent increase laws or speak with a trusted real estate lawyer.

Rent Increase Notice Periods

Next, let’s examine California’s notice requirements for each lease agreement type:

Fixed-Term Lease

You can only raise your tenant’s rent when you’re renewing the agreement, unless your fixed-term lease includes a clause permitting mid-term hikes. In either case, California law doesn’t require a specific notice period.

Send tenants a written notice at least 30 days in advance to avoid disputes and maintain transparency.

Month-to-Month Lease

For a month-to-month lease agreement, California law requires the following:

• 30 days’ written notice for increases 10% or less
• 90 days’ written notice for increases over 10% (Cal. Civ. Code § 827)

Keep in Mind: State law applies the same notice period requirements to room rental agreements.

How to Deliver a Rent Increase Notice in California

Landlords must either hand-deliver the letter to the tenant or mail it first-class (Cal. Civ. Code § 827). If you drop it off, the notice period starts immediately. But if you mail it, the notice period begins 5 days after you send it (Cal. Civ. Code § 1013).

Digital notices are only legally binding if both parties agree to use them in the lease agreement (Cal. Civ. Code § 1633.7).

Understanding Illegal Rent Increase and Retaliation

For starters, increasing rent during an active fixed-term lease breaches your agreement. But state and federal laws also prohibit retaliation and discrimination. Here’s what you need to know:

Anti-retaliation laws: In addition to rent stabilization policies, California law strictly prohibits landlord retaliation. You can’t raise a tenant’s rent to get back at them for taking the following protected actions:

• Reporting health and safety violations to a government agency
• Requesting repairs
• Exercising tenant rights
• Joining a tenant union

If a tenant takes one of these actions and you raise their rent after 180 days, state law presumes retaliation unless you prove otherwise (Cal. Civ. Code § 1942.5).

Fair Housing Act: At the same time, the federal Fair Housing Act (FHA) protects tenants from discrimination. Landlords can’t consider the following protected characteristics when adjusting their tenants’ rent:

• Race
• Color
• National origin
• Religion
• Sex
• Familial status
• Disability (Fair Housing Act)

Avoid potential issues by keeping your process consistent and fair across all tenants.

How to Write a California-Compliant Rent Increase Letter

Whether you’re leasing a property in the Bay Area or SoCal, add the following to your rent increase letter:

• Property address and unit number
• Tenant names
• Exact increase amount 
• New total rent amount
• Effective date
• Instructions for tenants

Save time and stay professional by using a free, standardized template. Try TurboTenant’s downloadable California rent increase letter template to prevent he-said-she-said disputes.

Managing the Rent Increase Process with Tenants

As the final step, wait for your tenants’ reply to your letter. Follow these next steps based on your tenant’s response:

• Accept: Once tenants agree to the new price, proceed with the renewal by updating the lease and obtaining your tenant’s signature.
• Move out: If tenants refuse the increase, they can move out at the end of the lease. Get ready to re-rent your unit to keep your income flowing.
• Negotiate: Sometimes tenants ask landlords to reconsider the price increase. If a great tenant asks to negotiate, consider offering a longer lease term or covering a portion of the utility bill rather than dropping your price.

Unlike in other states, California law doesn’t mandate that landlords offer a grace period after increasing rent. You can begin charging your new rate on the effective date.

Use this guide as a shortcut to comply with California rent increase laws — so you can save time, mitigate risk, and keep your business profitable.