What LA Landlords Need to Know About the LA Rent Stabilization Ordinance

If you own rental property in Los Angeles, there's a good chance the LA Rent Stabilization Ordinance, commonly known as the RSO, applies to your property. Understanding what it does and doesn't allow is one of the most important things you can do as a landlord in this city. Getting it wrong can be costly.

What properties are covered

The RSO covers most residential rental properties in the City of Los Angeles that were built and first occupied before October 1, 1978 and have two or more units. This includes apartments, condominiums, and some single-family homes and condos that were rented before February 1995.

Properties built after October 1, 1978 are generally not covered by the RSO, though they may be subject to the state's AB 1482 tenant protection law, which we'll come to shortly. If you're not sure whether your property is covered, the LA Housing Department has an online lookup tool.

Rent increase limits under the RSO

For properties covered by the RSO, rent increases are limited to a percentage set annually by the city, based on the Consumer Price Index. Historically this has ranged from 3% to 8% per year. Landlords cannot increase rent above this amount during a tenancy, regardless of what the market is doing.

There are some exceptions. Landlords can apply to the Housing Department for a higher increase in specific circumstances, such as if they've made capital improvements to the property or if their costs have increased significantly. But these require a formal application and approval process.

Rent increases must also follow specific notice requirements. A notice of less than 10% requires 30 days written notice. An increase of 10% or more requires 90 days written notice.

Just cause eviction requirements

One of the most significant aspects of the RSO for landlords is the just cause eviction requirement. You cannot evict a tenant in an RSO-covered property without a legally recognized reason. Accepted reasons include non-payment of rent, breach of the lease, nuisance, illegal activity on the premises, and the landlord's intention to move into the unit themselves or to take the property off the rental market.

If you want to evict a tenant to move in yourself or a family member, or to substantially renovate the property, you are required to pay the tenant relocation assistance. The amount depends on the length of the tenancy and the tenant's circumstances.

AB 1482 and newer properties

For properties not covered by the RSO but subject to California's AB 1482, rent increases are capped at 5% plus the local Consumer Price Index, with a maximum of 10% per year. AB 1482 also includes just cause eviction protections for tenants who have occupied a unit for more than 12 months.

AB 1482 covers most residential rental properties in California that are more than 15 years old, with some exceptions including single-family homes and condos where the owner has provided the tenant with a specific exemption notice.

What this means practically for landlords

If you own an RSO-covered property, the most important practical implications are that you need to keep records of all rent increases and notices, you need to understand the just cause requirements before attempting to end a tenancy, and you should factor rent stabilisation into your financial projections for the property.

It's also worth knowing that the city has a landlord registration requirement for RSO properties. Landlords are required to register their rental units annually and pay a registration fee. Failure to do so can affect your ability to collect rent increases.

Getting professional advice

Landlord-tenant law in LA is genuinely complex and changes periodically. This article is intended as an overview, not legal advice, and the specifics of your situation may be different. If you're a landlord with questions about your obligations, it's worth consulting with an attorney who specializes in this area, particularly before making decisions about rent increases, tenancy terminations, or renovations.

As an agent, I work with landlords at the stage of finding and securing tenants. A well-structured lease and a thorough tenant screening process are the best ways to start a tenancy on the right footing, which makes everything that follows easier.