California governor signs law capping rent increases
SACRAMENTO, Calif. (AP) — California will limit rent increases for some people over the next decade after Democratic Governor Gavin Newsom signed a law Tuesday aimed at combating a housing crisis in the nation’s most populous state.
Newsom signed the bill at an event in Oakland, an area where a recent report documented a 43% increase in homelessness over two years.
Sudden rent increases are a contributing cause of the state’s homeless problem, which has drawn national attention and the ire of Republican President Donald Trump.
“He wasn’t wrong to highlight a vulnerability,” Newsom said of Trump’s criticisms to an audience of housing advocates in Oakland.
“He’s exploiting it. You’re trying to solve it. That’s the difference between you and the president of the United States.”
The law limits rent increases to 5% each year plus inflation until January 1, 2030.
It bans landlords from evicting people for no reason, meaning they could not kick people out so they can raise the rent for a new tenant.
And while the law doesn’t take effect until January 1, it would apply to rent increases on or after March 15, 2019, to prevent landlords from raising rents just before the caps go into place.
California and Oregon are now the only places that cap rent increases statewide.
Oregon capped rents at 7% plus inflation earlier this year.
California’s rent cap is noteworthy because of its scale.
The state has 17 million renters, and more than half of them spend at least 30% of their income on rent, according to a legislative analysis of the proposal.
But California’s new law has so many exceptions that it is estimated it will apply to 8 million of those 17 million renters, according to the office of Democratic Assemblyman David Chiu, who authored the bill Newsom signed.