LA reforms rent control for first time in 40 years, lowering rent hikes for most tenants

After more than two years of discussion and debate, the Los Angeles City Council voted Wednesday to significantly lower annual rent increases in most of the city’s apartments.

L.A.’s current rent control rules guarantee landlords the right to raise rents at least 3% every year. Increases can be as high as 10% in some apartments during periods of high inflation.

But under the reforms passed by 12 of the council’s 15 members, rent increases would be capped at 4% annually, and an additional 2% increase for landlords who cover utilities would be eliminated. The exact rate each year would be equal to 90% of the change in the region’s consumer price index, a government measure of economic inflation.

“We need to make a change to this formula,” said Nithya Raman, chair of the council’s Housing and Homelessness Committee ahead of the vote. “Extraordinary rent increases are driving people out of the city.”

The rules passed by the majority of councilmembers would set a new floor of 1% in years of low inflation. Councilmembers Bob Blumenfield and John Lee voted against the changes, and Councilmember Curren Price recused himself from the vote because he is a landlord.

This is the first overhaul of the city’s rent increase formula since 1985. Tenant groups have long argued that the current rules increase costs faster than incomes for many renters, pushing some toward eviction and potential homelessness.

Landlord groups decried the changes, saying the city is further clamping down on their ability to keep up with skyrocketing insurance premiums and steep maintenance costs.

Before the new rules take effect, they still need to be drafted by the City Attorney’s Office and returned to the council for a final vote.

‘We would end up homeless’

The changes represent a step toward but not a full adoption of the demands for a 3% cap at 60% of inflation from tenant groups. Humberto Altamira, an unemployed cook living with his wife in L.A.’s downtown Fashion District, said his family’s rent went up about $50 per month earlier this year, and they would struggle to afford another increase of 3% or more.

“We would end up homeless and living on the street,” Altamira said, speaking in Spanish.

Humberto Altamira and his wife stand in front of L.A. City Hall ahead of a City Council vote on rent control.

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David Wagner/LAist

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During the COVID-19 pandemic, the city banned increases for nearly four years. The new cap, while comparable to caps in many other Southern California cities, does not reflect the rising costs property owners face, said California Apartment Association spokesperson Fred Sutton.

“Reject arbitrary magic numbers,” Sutton said. “These changes will not create a single new home, but they’ll make it even harder to build, making the housing crisis worse for everyone.”

Where LA rent control applies

The city’s rent control rules generally cover apartments built before October 1978, as well as new units that replace demolished rent-controlled units or are attached to older buildings.

Nearly two-thirds of L.A.’s residents live in rental housing. And because most of them live in older properties, the city’s rent control rules affect about 42% of all L.A. households.

Some councilmembers, including John Lee, said stricter rules would run counter to other local policies to spur housing development, such as Mayor Karen Bass’ executive directive to speed up the approval of affordable housing projects.

“Just as we are gaining momentum, we are considering a change,” Lee said. “This sends the message, ‘Do not build here. Do not invest in Los Angeles.’”

Other councilmembers said getting rental costs under control is key to addressing homelessness. At last count, about 43,500 people lack housing in the city.

“We have an eviction-to-homelessness pipeline,” Councilmember Eunisses Hernandez said. “We get calls constantly from property owners about people experiencing homelessness around their buildings.

“We are struggling to deal with that crisis,” Hernandez continued. “We can’t house the number of people every year that are falling into homelessness. And a majority of that is because they can’t afford it.”

To build or not to build?

Renters and landlords crowded into City Council chambers to give public comment ahead of Wednesday’s vote.

Megan Briceño, who owns eight rent-controlled apartments, told LAist she has building permits to construct an accessory dwelling unit on her four-unit property in Mid-City L.A. Because the unit will be rent-controlled, she said the city’s changes could halt her building plans.

“I don't know how much longer I can continue to do business in a city that constantly feels like I'm fighting for my basic property rights, for a basic fair return,” Briceño said.

The process of reforming L.A.’s rent control ordinance was kickstarted in October 2023, when councilmembers Hugo Soto-Martinez and Bob Blumenfield asked for an in-depth review of the city’s rules.

LAist obtained the city-commissioned report produced in that process and was the first to publish it in September 2024.

Among other observations and recommendations, the report argued for eliminating an additional 2% annual increase landlords can impose if they pay for a tenant’s electricity and gas service. The report found that over time those increases can eclipse the entire cost of providing those utilities.

The reforms passed Wednesday include the elimination of this utility bump.