What Tenants and Landlords Need to Know About AB 1482

AB 1482, also called the Tenant Protection Act of 2019, is a statewide piece of legislation that affects rental properties . It went into effect January 1st, 2020 and is tentatively set to sunset on January 1st, 2030. As a property management company, we have seen its effects firsthand. Access works hard to ensure our properties as well as our actions are in compliance. AB 1482 affects tenants and landlords by regulating rent increases and just cause evictions, among other details.

While this law affects all locations of the state, there are local jurisdictions with stricter laws in place. In cities where rent control laws already exist, such as those governed by the Costa-Hawkins Rental Housing Act, AB 1482 broadens rent control to cover additional housing that was not covered by the previous legislation.

Which Properties are Subject and Which are Exempt

AB 1482 does not cover all properties. Here are some examples of exempted properties that landlords and tenants should be aware of:

  • Single-family homes – If the single-family home is owned by an corporation, a REIT (real estate investment trust), or an LLC that has a corporation as a member, then it is not exempt.
  • Duplexes – If the subject property is a duplex, and the landlord lives in one of the units, then the duplex is exempt from AB 1482.
  • New construction: New houses built within the last 15 years are exempt.
  • Student housing: If a rental property is owned and operated by a college or university and is used primarily for student housing, it is exempt from AB 1482.
  • Units restricted by a deed, regulatory restrictions, or other recorded document limiting the affordability to low or moderate-income households are also exempt.

Rental Increases

AB 1482 is most commonly known for its limitations on rental increases. It limits annual rent increases to 5% plus the local rate of inflation (CPI), or 10%, whichever is LESS. Given California’s recent high rates of inflation, 10% is the norm throughout the state.

Related: New Property Management Laws of 2023

Just Cause for Evictions

AB 1482 imposes “just cause” eviction requirements. This means that landlords cannot evict tenants without a valid reason. A valid reason would be failure to pay rent or violating a term on the lease. It is applicable after residents have occupied the unit for a certain period of time. Landlords can evict tenants under certain circumstances. This includes tenants engaged in delinquency, who create a nuisance or danger, or cause significant damage to the property. Owners are also permitted to move into the unit themselves or have a family member move-in. In this scenario they must provide the tenant with a written 60-Day Notice.

Tenants who believe they have been evicted without just cause may have legal remedies available to them under California law.

Relocation Fees

“No-fault” evictions are when the landlord enacted an eviction that was not the fault of the tenant. In these cases, AB 1482 may require landlords to pay a relocation fee. This fee is separate from the security deposit and landlords cannot deduct the relocation fee from the security deposit.

The amount for the relocation fee will depend on the length of tenancy and the size of the unit. Tenants that resided in their unit for less than one year would be owed the relocation fee of one month’s rent. Those that have lived in the unit for a year or longer may be owed a relocation fee of one month’s rent plus an additional half-month’s rent for each year the tenant has resided in the unit, with a maximum cap of two months’ rent.

There are exceptions to the relocation fee. For example, if the eviction is due to an uninhabitable unit, or the tenant hasn’t paid rent for fourteen days.

Final Words

AB 1482 is a landmark California law with the intent to balance the interests of tenant’s housing needs and landlords investment interests. Although the law is primarily to the benefit of, and offers legal protections to California’s tenants, landlords may see some benefit associated with the law, such as better stability of their cash flow over time. To date, the jury is still out. We’ve seen tenants take advantage of the additional protections which infringe on traditional private property rights, and we’ve seen landlords routinely raise rental rates to the maximum afforded by law simply because they have the legal right to. Consideration previously made by landlords, such as what would traditionally be considered a “good tenant”, whereby the landlord may offer below market rent are becoming more and more rare for fear of the landlord being unable to catch-up to market should the relationship sour.

As a property management company we work closely with our tenants and landlords to ensure compliance to AB 1482. This includes providing proper notice to tenants, calculating rent increases, and handling just cause evictions. We keep a close eye on real estate law updates to keep our clients informed.

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