In Whittier, CA, landlords can generally raise rent by a maximum of 5% plus the local Consumer Price Index (CPI) or 10%, whichever amount is lower, under California's statewide rent control law, AB 1482. This law applies across California, including Whittier, providing a cap on annual rent increases for many residential properties.
Understanding California's Rent Increase Limits (AB 1482)
California's Tenant Protection Act of 2019, commonly known as AB 1482, sets statewide limits on how much landlords can increase rent. This law aims to prevent excessive rent hikes and offers some stability for tenants.
The core components of the allowable rent increase are:
- A base percentage: 5%
- Plus the local CPI: This figure is determined by the California Consumer Price Index, which is released annually by the California Department of Finance.
- An overall cap: The combined total of the base percentage and the CPI cannot exceed 10%.
This means that landlords must calculate the 5% plus CPI, and then compare that sum to 10%. The lower of these two figures is the maximum allowable rent increase for that year.
How the Rent Increase is Calculated
To determine the maximum permissible rent increase, landlords follow a specific calculation:
- Identify the applicable CPI: Find the annual California Consumer Price Index published by the California Department of Finance for the relevant period.
- Add the fixed percentage: Add 5% to the identified CPI.
- Apply the 10% cap: Compare the sum from step 2 with 10%. The maximum allowable increase is the lower of these two values.
Here's a breakdown of the calculation process:
| Component | Description |
|---|---|
| Fixed Percentage | A constant 5% increase. |
| Local CPI | The annual percentage change in the California Consumer Price Index, as published by the California Department of Finance. This reflects the regional inflation rate and can vary year to year. |
| Maximum Cap | Regardless of the sum of the fixed percentage and CPI, the total rent increase cannot exceed 10% in any 12-month period. If 5% + CPI results in a number greater than 10%, the increase is capped at 10%. If it results in a number less than or equal to 10%, that number is the maximum. |
Practical Example
Let's illustrate with an example:
-
Scenario 1: Moderate CPI
- If the California CPI for the relevant period is 3%.
- The calculation would be: 5% (fixed) + 3% (CPI) = 8%.
- Since 8% is less than the 10% cap, the maximum allowable rent increase would be 8%.
-
Scenario 2: High CPI
- If the California CPI for the relevant period is 6%.
- The calculation would be: 5% (fixed) + 6% (CPI) = 11%.
- However, because of the 10% cap, the maximum allowable rent increase would be 10%.
Important Considerations for Tenants and Landlords
While AB 1482 provides a general framework, it's essential to understand that certain properties may be exempt or have different rules. For instance, some newer constructions (built within the last 15 years) or single-family homes not owned by a corporation or Real Estate Investment Trust (REIT) may be exempt from the statewide rent cap, though they still require proper notice for rent increases. Always verify the specific rules applicable to a particular property.
For accurate and up-to-date information on the current CPI and how it applies to rent increases in California, it is recommended to consult the official publications from the California Department of Finance.
