How to list rental property to prevent the Price Gouging in California

[Daniel Liu]

Existing tenant stayed in my rental property 3 years without rent increase. Tenant will move out for a bigger place next month. Current market rental price is about 20% higher than existing rent. Could I list my rental as the market price? or I have to list it as existing rent plus 10%?

Thanks

[Greg M.]

Once the tenant moves out you are allowed to charge any amount you like. There are no laws restricting mark-to-market rents. 

The City/County/State rent caps only apply to leases that are being renewed. 

There is a State of Emergency in effect and anti-price gouging laws apply. For items not available before the SoE and hitting the market after the SoE, you can raise prices a max of 50%. This would apply to your unit.

Your biggest concern with setting the rent should be the near future. 1) Your insurance is guaranteed to go up, probably dramatically.  2) You may get an insurance assessment bill to cover the CA Fair Plan losses. Guesstimates are around $1000 per unit. 3) Demand is crazy right now. The builders that were building rentals are most assuredly going to switch over to rebuilding the higher profit multi-million dollar homes. The so-called glut of rentals is gone and prices are strongly higher. Prices are easily up 15% since the fire.