New Laws Every California Landlord or Property Managers Need to Know

New Laws Every California Landlord or Property Manager Needs to Know

California legislators have been busy during the first half of 2019! There have been a number of new bills, acts, and ordinances that have either been passed or are currently pending, many of which have implications for landlords and property managers. Even if you don’t have rental properties in California, it’s important to keep updated on what’s coming down the legislative pipeline, because as we’ve seen, some types of legislation have a way of becoming a national trend. Here’s an overview of what you should be aware of:

Tenant Screening Fee – Pending

The total amount allowed for tenant application fees has increased by $1.81. This brings the total amount that landlords are allowed to charge for screening processing fees to $50.94.

Just Cause Eviction – Pending 

There are two “just cause” eviction bills that have been proposed this year. Both bills attempt to limit evictions to specific reasons, such as failure to pay rent and define some “no fault” eviction causes (like demolishing the unit) but the bills contain some differences. AB-1697, if passed, would only apply to tenants who had been occupying the residence for 10 months or more. AB-1481 would apply to all tenants while also banning the owner’s right to terminate the tenancy to move into the unit if the tenant is 60 years or older – unless it was disclosed in the lease or permitted by the tenant. 

Both bills have been moved to the inactive file at this time. 

Keep Californians Housed Act – Pending

The existing laws require tenants with a month-to-month lease to be provided with 90 days written notice if the property is sold in foreclosure. Tenants that have a fixed-term lease would have the right to occupy the property until the end of the lease period, except under specified circumstances. The law officially expires on December 31, 2019. If SB-18 passes, the law will stay in effect indefinitely. 

Rent Control – Pending

This year there were two bills proposed regarding rent control: AB-1482 and AB-36. AB-1482 would put a 5% cap on annual rent increases – plus the percentage change in the cost of living. Rental owners would be prohibited from terminating the tenancy to increase rent above the cap amount. If AB-1482 passes, the law will be active until January 1, 2030. 

If passed, AB-36 would allow local governments to cap rents on single-family rental properties and on construction on rental properties that are at least 20 years old. Landlords with 10 units or less would be exempt. 

Extended Notices for Rent Increases – Pending

Existing law states that month-to-month tenants must be provided 30 days notice if landlords increase the rent by 10% or more. If the increase is more than 10%, the landlord is required to provide 60 days’ notice. If passed, AB-1110 would require landlords to provide 90 days notice for increases that are more than 10% but under 15%. If the landlord plans to increase the rent to more than 15%, they would be required to provide their tenants with 120 days’ notice. This bill is currently in the Senate. 

Applicant’s Criminal Records in the Screening Process – Pending

In a trend we’re starting to see nationally, the AB-53 bill aims to reduce discrimination of rental applicants due to criminal records. If passed, this bill would prohibit landlords and property managers from asking about criminal records during the application process. Once the preliminary application phase is completed, landlords would then be able to conduct a criminal background check. If the landlord wants to deny an applicant based on their criminal screening, they’ll be required to provide the applicant with a written statement of their decision within 5 days of receiving the criminal background report. 

Rental applicants would then have 2 days from receiving the statement to respond to the accuracy of the criminal check, evidence of rehabilitation, or other factors that may prove their history doesn’t affect their status as a potential tenant. The landlord would then have to consider these factors within a specified amount of time; if their decision not to rent to them still holds, they would be required to notify the applicant again in writing. Additionally, AB-53 would require landlords to provide a notice stating that criminal records are used as a part of their screening process. 

Allowances for Tenants to Shelter People at Risk of Homelessness – Pending

The AB-1188 bill would allow tenants to temporarily shelter a person at risk of homelessness for up to 12 months, regardless of what was stated in the lease about co-habitants. Landlords would be able to adjust the rent as compensation for an extra person occupying the property. The terms for the new rental amount would need to be stated in writing and agreed upon by the tenant and the owner. The bill would also allow owners to establish the rights and the obligations for all parties, including making the tenant liable for the additional occupant (to the extent of the terms within the lease) and requiring a written rental agreement from both parties. 

Requirements for the Homeless Coordinating and Financing Council – Pending

SB-333 would require the Homeless Coordinating and Financial Council to develop and implement an effective plan to address the large homeless population in California by July 1, 2021. 

CalWORKs Extension and Payments – Pending

CalWORKs (the California Work Opportunity and Responsibility to Kids) program provides financial assistance to low-income and homeless families. CalWORKs currently provides permanent housing assistance to pay for up to 2 months of the last month’s rent and security deposits. The AB-960 bill would allow counties to approve extended shelter assistance to prevent homelessness while households are waiting to receive permanent homeless support. It would also remove the requirement of property owners needing to have a history of renting properties to be able to receive payments. 

Using Pesticides – Pending

The AB-1788 bill, also known as the California Ecosystems Protection Act of 2019, would expand the prohibited use of common types of rat poisons in wildlife habitat areas. 

Long Beach’s Tenant Relocation Ordinance – Pending

Back in April this year, the Long Beach City Council voted in favor of an ordinance that would require landlords with 4 or more units that are older than 1995 to pay a tenant’s relocation fees if they raise the rent more than 10% in a year. They would also have to pay relocation fees if they require the tenant to move. The relocation amounts are subject to change, but currently, they would cover $2,706 for studios, $3,235 for a one-bedroom, $4,185 for a two-bedroom, and $4,500 for a property with 3 or more bedrooms. 

Inglewood’s Temporary Rent Caps and “Just Cause’ Eviction Policy – Passed

In March 2019, Inglewood set a 5% temporary rent cap for pre-1995 apartments as well as a “Just Cause” eviction policy. The policy has since been approved permanently, blocking property owners from increasing rents more than 5% annually. Renters will also be eligible for relocation allowances when they’ve lived at a property for at least 2 years and were evicted for “just cause.” 

Of Note: Los Angeles Rent Control 

The annual allowable rent increase for rent-controlled housing was increased to 4% within the City of Los Angeles. This increase first took effect on July 1, 2019 and runs through June 30, 2020.

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