Many state, county, and city governments have laws limiting the amount of rent landlords may charge. Some of these ordinances also restrict the circumstances under which landlords may terminate month-to-month rental agreements or not renew leases. Rent control laws such as these (also called “rent stabilization” or “maximum rent regulation” laws) are in effect in some of the country’s largest cities, including New York City, Washington, D.C., Los Angeles, San Francisco, Newark, San Jose, and Oakland.
Rent control ordinances vary widely in their exact terms. Some (including some of those in effect in New York) have real teeth, while others (in San Jose and Oakland, for example) are practically useless for tenants.
The idea of rent control is more popular in some states than others. Many states, such as Texas, New Mexico, and Florida, restrict local rent control rules or ban them altogether. Some states, such as Montana and Ohio, have no laws regarding rent control. Others, such as California, leave the decision to implement rent control to county and city governments. One state, Oregon, has rent control laws that apply statewide.
Rent control ordinances tend to be extremely complex, and every ordinance is different, making it impossible to describe each in detail. However, many rent control ordinances contain restrictions, rules and exceptions similar to those addressed below.
Not all rental housing within a rent-controlled area is subject to rent control. Commonly, ordinances exempt:
Rent control comes in two basic forms. “Vacancy decontrol” protects only the current tenant by ending rent restrictions when the tenant moves out. “Vacancy control” regulates rent over the long term, keeping rent restrictions in place even when a new tenant moves in.
In most rent control areas, landlords may raise rent as much as they want when one tenant moves out and a new one moves in. This feature, called “vacancy decontrol” or “vacancy rent ceiling adjustment,” means that rent control applies to a particular rental unit only as long as a particular tenant (or tenants) stays there.
If a tenant voluntarily leaves or, in some cities, is evicted for a legal or “just” cause (discussed below), the rental unit is not subject to rent control again until the landlord sets the new (and presumably higher) rent. In short, tenants in a “vacancy decontrol” city shouldn’t expect to pay the same rent as the prior tenant.
In addition to built-in annual increases, most rent control boards allow landlords to petition for a rent hike based on an increase in costs, such as higher taxes or expenses due to remodeling or bringing the building up to code.
Vacancy control statutes lock in the rent even when a new tenant moves in. The rent board sets a base rent for each rental unit, taking into account factors such as the rent that was charged before rent control took effect, the landlord’s operating and maintenance expenses, inflation, and housing supply and demand.
The base rent may be raised during the tenancy under certain circumstances, such as an increase in inflation. When the tenant moves out, a landlord cannot raise the rent to market level. Rent stays controlled, and can be increased only by as much as the rent control ordinance allows.
Tenancies normally end on their own accord: either at the end of a lease or after the proper amount of notice has been given in a month-to-month tenancy. As long as the landlord is not acting with discriminatory or retaliatory motives, the landlord can decide to end the tenancy, no reasons needed.
But for rent control to work—especially if the ordinance allows landlords to increase rent when tenants leave—there must be added restrictions on eviction. Otherwise, landlords could throw out current tenants in order to get a chance to increase the rent. Recognizing this, many local ordinances require landlords to have a “just cause”—that is, a good reason—to evict. Acceptable reasons typically include:
Landlords who evict tenants without just cause often face stiff civil and even criminal penalties.
Landlords in vacancy decontrol areas are fairly notorious for devising creative “just causes” to evict tenants—especially long-term tenants—in order to get a chance to raise the rent to market rate. Sometimes it’s easy for a landlord to find a just reason for the eviction, such as pointing to an unauthorized pet. Other times, landlords point to a trivial offense, such as a single instance of rent arriving a day late.
To prevent these types of disingenuous evictions, some rent control ordinances require that the landlord’s stated reason for eviction be the landlord’s “dominant motive.” In other words, if the tenant can prove that the landlord’s dominant motive for the eviction is a desire to raise the rent (despite the landlord’s stated reason that the tenant paid rent a day late) the tenant might prevail in court. Proving the landlord evicted in bad faith is no easy task, though, and requires the tenant to devote precious time and money to fighting the eviction.
If you’re facing a just-cause eviction that you believe is actually motivated by the landlord’s desire to raise the rent, one strategy is to fight aggressively as soon as you think your landlord might be planning to file an eviction suit. Research your local ordinance and make it clear to your landlord in writing that you do not believe the eviction is legal and that you plan to defend yourself to the full extent of the law. Emphasize whatever penalties exist in your area for violating the rent control law, and send copies of your correspondence to the rent board.
In some areas, such as San Francisco, you can file a complaint against your landlord with the rent board for wrongful eviction. While most rent control boards don’t have the power to stop an eviction lawsuit once the landlord has filed it in court, they might be able to dissuade a landlord from pursuing an eviction that has little merit by reminding the landlord of the law—and of the potential penalties for violating it.
Sometimes, rent control ordinances impose rules unrelated to rent that protect tenants. Check your ordinance to see whether protections like the following apply to you.
Rules regarding security deposits. Some rent control rules mandate how landlords hold security deposits. For example, Los Angeles requires landlords to put security deposits in interest-bearing bank accounts. Other laws might require landlords to hold security deposits in separate bank accounts or deposit them in a federally-insured bank.
Special notice requirements. Many states have laws about how much notice a landlord must give a tenant before raising the rent or terminating the tenancy. For example, many states require landlords to give tenants 30 days’ notice before raising the rent. Local rent control laws often contain additional notice requirements. For example, a local rent control law might also require the notice include information about how the rent control board can verify that the new rental amount is legal under the ordinance.
Sources of information about rent control where you live might include: