Decision Allows Rent Increases Ending Pandemic Protections
The Los Angeles City Council voted 10-2 to lift a three-year-old rent freeze on more than 600,000 rent-controlled apartments, allowing for a potential 4 percent rent increase, or up to 6 percent if landlords cover utility costs. The decision, set to take effect on Feb. 1, impacts 624,000 rent-stabilized units, constituting 75 percent of the city’s rental apartments. Landlords, who have been unable to raise rents since the onset of the pandemic in March 2020, will now have the opportunity for adjustments.
As part of the approved plan, the city’s Housing Department is tasked with developing programs to assist landlords and tenants, particularly focusing on aiding small housing providers in maintaining and preserving rent-controlled units. Additionally, the council has called for a report to establish rules distinguishing mom-and-pop landlords from corporate entities, ensuring that smaller landlords receive the necessary support to remain in business.
The city’s Rent Stabilization Ordinance applies to rental housing constructed before 1978, limiting allowable increases for units by tying them to the consumer price index, a measure of inflation.
In response to the looming rent hike deadline, Councilman Hugo Soto-Martinez introduced a motion on Oct. 25 seeking to extend the freeze. Councilman Bob Blumenfield later amended the motion during a Housing and Homelessness Committee meeting on Nov. 1. The amendment permits rent increases starting in February, with adjustments based on the consumer price index from October 2022 through September. As of September, the CPI rose by 3.7 percent over the past 12 months. Using this inflation guide, the formula allows for a rent increase of 4 percent, or up to 6 percent, as opposed to the initially proposed 7 percent increase.
Blumenfield described the compromise as one that “no one will like.” Councilman John Lee, who voted against the plan, expressed concerns that limiting rent increases could lead small landlords to sell their properties to larger corporate entities. Councilwoman Nithya Raman emphasized the importance of protecting tenants and rent-controlled units, highlighting the need to ensure that mom-and-pop landlords remain in business in Los Angeles. Three members of the Council, Paul Krekorian, Curren Price, and Katy Yaroslavsky, recused themselves from the vote since they were landlords.
