FYI: City of Los Angeles to Move Forward with Further Rent Control

FYI: City of Los Angeles Moved Forward with Further Rent Control

The Los Angeles Housing and Homelessness Committee has recommended updates to the city’s Rent Stabilization Ordinance (RSO) to change how annual rent increases are calculated. The proposal would base rent hikes on 60% of the Consumer Price Index, with a minimum increase of 0% and a maximum of 3% per year. It also removes extra rent increases tied to utility costs, prevents additional charges when tenants add dependents, and calls for more financial support to help small landlords maintain and repair their properties using existing housing funds. Overall, the changes aim to better balance tenant protections with support for small property owners, without impacting the city’s General Fund.

Opposing Arguments

Opponents argued that further tightening rent control would harm both housing providers and the city’s long-term housing stability. The main themes included rising operating and maintenance costs, discouragement of new housing construction, and financial pressure on small landlords. Many warned that overly restrictive rent caps would drive out mom-and-pop property owners, reduce maintenance quality, and shift the market toward large corporate landlords, while also scaring off investment capital needed for development.

Supporting Arguments

Supporters of the ordinance emphasized tenant protection, housing affordability, and worker stability as key priorities. They argued that many working families, including union members and essential workers, are priced out of their communities, forced into long commutes, or even homelessness. The overall narrative centered on keeping housing affordable, aligning rent increases with wage growth, and preventing displacement amid rising living costs and limited public support.

Ultimately, the request to draft the updated ordinance passed 12-2 with one absent Councilmember. The real estate industry worked with the City Council to modify their original ordinance. Key changes include:

• Annual rent hikes for RSO (Rent Stabilization Ordinance)-regulated buildings will have a 1% floor and 4% ceiling, replacing the committee’s proposed 0% floor and 3% ceiling.
• The formula for calculating allowable increases will now use 90% of the Consumer Price Index, up from the 60% recommended by the committee
• The current 1%-2% increases for landlords who pay for gas or electricity will be eliminated.
• Landlords will no longer be allowed to impose extra rent hikes for tenants with additional dependents.

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