California Rent Control

[Stephanie Chiramberro]

What do you think about rent control passing in California? What do you think will be the repercussions?

[Penny Clark]

@stephaniechiramberro, I think the  this action by the California legislature will result in the following:

- Landlords who had previously been reluctant to raise rents on good tenants will now do so every year without fail.  Installing a new tenant at a higher market rent may be preferable to landlords who once feared the possibility of unit becoming vacant due to rent increase. 

-  Application process will likely become more stringent for screening tenants which may include, requiring higher credit scores and/or lower debt to income ratios, in depth rental reference checks, and income verifications. 

- Leases will be longer with more restrictions and requirements such as mandatory renter's insurance and tenants paying all utilities. Landlords may remove option of automatic renewal to  month to month once lease term expires. There is no strong incentive to keep the tenancy going past a year. 

- Landlords may lower or increase security deposit from the standard equal to 1 month's  rent. 

- Cosmetic improvements may be restricted to exterior of home. Landlords may only approve necessary repairs to satisfy City and County codes. 

- More landlords will move into the short-term rental market

I'm sure other landlords out there can add their own predictions. I am glad that most of our rentals are already getting market rent.