Over time there will inevitably be the need to increase the rent that the tenants are paying. No one wants this to happen but it will not be possible to keep it the same year after year and keep paced with other cost of living increases. This rent increase is something that must be written into the tenancy agreement when it was set up and as a result it is important that this is done as it will save time later on.
If a clause regarding rent increases has not been included and the tenant does not agree to pay more, then according to the Housing Act of 1988 tenant rent increases can be done by issuing a Section 13 Notice in California.
Increasing the Rent
Once the term of the tenancy has been completed the rent can be increased as long as it is done legally in the correct way. There is not a lot that the tenant can do about this and if they cannot accept the new price they will need to leave the property. This can either be by leaving once the tenancy expires, or if they refuse to go they can be evicted. For a new lease or rental agreement to start, both parties have to agree to the new rate.
The landlord will have to give notice that they are going to apply for rent increase and this will in California vary depending on the length of tenancy. It will be a month if the tenant has been there for a year or less and the rental agreement is for:
- A week
- A fortnight
- A month
If they have been a tenant for more than a year you will need to give them 60 day notice of rent increase in California
If it is for a year lease, then there is a period of 6 months required. Ideally this will give the tenant time to look for another property if the tenant doesn’t agree and also time to put money aside to cover the increase if they do. Also if they are open about not wanting to pay, negotiations could start and also the landlord can start looking for a new tenant. The payment date must be the same as under the old lease agreement.
The Section 13 California Rent Increase Notice
This form is easy to fill in and must give all details of the cost and date of collection. Failure to follow the correct procedure serving this notice means the higher rent does not have to be paid. It will also go against the landlord in California Courts if they try to evict claiming arrears arising from the increase.
Rent Assessment Committee
There is a place to appeal if the new rate is considered excessive. It could lead to the property being assessed and the committee will decide the new payment. It could be that they agree with the raise especially if the rent increase is in keeping with similar properties in the area. Even then it could take a year before the raise can take place.
If you are a landlord in California thinking about raising your tenant’s rents, be sure to do the essential research of what are the current going rental rates in your area, and know the California laws and regulations you must following increasing a tenant’s lease or rental agreement.