Following the historic defeat of Proposition 10 in the November 2018 election, California’s elected officials have been working harder than ever before to accomplish their goal of rent control in California and AB 1482 is their latest attempt at accomplishing their goal.
Although it looked like AB 1482 would be defeated on Wednesday because the bill was short of the votes that it needed to pass, Assemblyman Chiu was able to secure the votes that he needed after agreeing to several amendments to the bill so that it passed with 43 yes votes and 31 no votes.
Some highlights of the amendments that Chiu has agreed to take relative to AB 1482:
- Increasing the annual cap on rent increases from CPI plus 5% to CPI plus 7%, the same cap adopted by Oregon earlier this year.
- Exempting owners with 10 or fewer single-family homes.
- Sunsetting the bill in three years, but with the option to renew – a foregone conclusion.
Source – California Apartment Association
About AB 1482
Until January 1, 2030, prohibit an owner of residential real property from increasing the rental rate for that property in an amount that is greater than five percent plus the percentage change in the cost of living, as defined, more than the lowest rental rate in effect for the immediately preceding 12 months, subject to specified conditions.
The bill would exempt from these provisions deed-restricted affordable housing, dormitories, housing that has been issued a certificate of occupancy within the previous ten years, and housing subject to a local ordinance that imposes a more restrictive rent increase cap than these provisions.
What Does AB 1482 Mean to California?
The next step for David Chiu is to get AB 1482 through the Senate by September 2019 and to Governor Newsom’s desk.
Sadly, AB 1482 doesn’t address the real cause of the housing problem in California which is a shortage of rental properties across the state, especially near job centers, and sources of public transportation.
The housing problem in California has always been a supply vs demand problem and until politicians actually realize that bills like AB 1482 will disincentive investors from building new properties and renovating existing housing in the state, California will continue to deal with a housing crisis that may continue to last for years to come.
Contact 36 North Property Management
To learn more about AB 1482 and what it means to your rental property business, or to speak with us about our property management services, contact us today by calling (831) 484-4604 or click here!