Why 'one month free rent' deals in LA are often too good to be true

In a city where most tenants shell out more than 30% of their income on rent alone, the prospect of living somewhere rent-free for an entire month is enticing. But move-in specials offering one month of free rent are often not much of a deal in the long run in Los Angeles.

That’s because the L.A. Housing Department lets landlords base future rent increases on a non-discounted amount. Even if renters have never actually paid the higher rent, landlords can use it as a baseline for subsequent rent hikes.

Christian Corpora found this out the hard way.

When he moved into his apartment in L.A.’s Larchmont neighborhood last summer, he thought he’d scored a great deal. It had off-street parking, air conditioning and an in-unit washer and dryer. He was even offered a move-in special: one month of free rent. In practice, this meant he paid a lower, pro-rated monthly rent — lower than the amount printed in his lease.

Corpora also knew the apartment was subject to the city’s rent control caps, which currently limit annual increases to 3% — or up to 5% if landlords pay for a tenant’s gas and electricity. These rules generally apply to apartments built before 1978, which make up about two-thirds of units in the city.

“I was really excited to find an apartment that had all these features, that was in my price range, in a neighborhood that I loved,” Corpora said. “Then to get a move-in special on top of it felt like, oh my gosh, well this is perfect.”

Hit with a rent hike of almost 12%

Then it came time for his first annual rent increase. Corpora knew his landlord was likely to hike the rent. But he was caught off guard when his new monthly rent increased by nearly 12%.

“My income, unfortunately, has increased 0% in the past year, so that made it completely infeasible for me to be able to stay,” he said.

After doing some research on his own and getting advice from the L.A. Tenants Union, Corpora learned that the city considers this practice legal.

A spokesperson for the L.A. Housing Department confirmed that the city allows landlords to use a lease’s non-discounted rent as the basis for future increases. That’s true even if the tenant never paid the higher amount, and was never informed that subsequent rent hikes would be determined by a number that can be buried in long, complicated lease agreements.

Other cities with local rent control laws do not allow this practice. West Hollywood has overturned efforts by landlords to use discounts as a premise for raising rents above local rent control limits.

‘It feels like a bait-and-switch’

Corpora said when he first moved in, no one told him how the one-month-free discount would factor into his future rent increases.

“It does feel a little bit like I got a little bit bamboozled,” Corpora said. “But now I know what to look out for in the future.”

Corpora said he’s now finalizing a move into a new apartment — one that offered no up-front incentives. He says he’s fine with the lack of discounts.

“I don't think I would trust a move-in special anymore,” he said. “It feels like a bait-and-switch.”

Rent control in L.A.

The debate over how much landlords should be allowed to raise rents in L.A.’s rent-controlled apartments has taken center stage at City Hall in recent months.

A city-commissioned economic report obtained by LAist through a public records request determined that some city rules, such as the extra two-percentage-point annual increase for providing gas and electric service, disproportionately favored landlords over tenants.

Last year, housing officials recommended the City Council reduce the current maximum rent increase from 5% to 2%. Some tenant advocates argue reforms should include even lower limits. Landlords complain the recommendations don’t account for costs such as insurance premiums, maintenance and trash pick-up, which have risen more than overall inflation.

The City Council has yet to schedule a vote on changes to L.A.’s decades-old rent control rules.