First rental in California: what AB 1482 means for a new landlord
By Francisco Williams, CCIM · CCIM · Mortgage Loan Originator NMLS #1858674 · CA DRE #01979442 · Updated
Short answer
California's Tenant Protection Act (AB 1482) caps annual rent increases at 5% plus local CPI, up to 10%, and requires just cause to end tenancies after 12 months. Many single-family homes and condos owned by individuals are exempt, but only if the lease includes the statutory exemption notice. Local rent laws can be stricter.
The two rules
Rent cap (Civil Code §1947.12): increases over any 12 months are limited to 5% plus the regional CPI change, never more than 10%. Just cause (Civil Code §1946.2): after a tenant has lived there 12 months, a tenancy can end only for listed at-fault or no-fault reasons, and some no-fault reasons require relocation assistance.
Who's covered and who's exempt
The table summarizes common exemptions. The single-family exemption is the one most first-time landlords rely on, and it's the one most often lost by missing the notice.
| Property | Rent cap | Just cause |
|---|---|---|
| Single-family home or condo owned by individuals, with the required lease notice | Exempt | Exempt |
| Same, without the notice | Covered | Covered |
| Owned by a REIT, corporation or LLC with a corporate member | Covered | Covered |
| Built (certificate of occupancy) within the last 15 years | Exempt | Covered |
| Owner-occupied duplex (owner lives in one unit) | Exempt | Exempt |
| Housing subject to stricter local rent control | Local rules apply | Local rules apply |
Summary only; read §1946.2 and §1947.12 and check local ordinances.
SB 567 (2023) tightened no-fault evictions
Since April 1, 2024, owner move-in and substantial-remodel evictions carry stricter requirements: owner move-in requires the owner or relative to move in within 90 days and live there at least 12 months, and remodel evictions need permits and a description of the work. Penalties apply for violations.
Check local rules too
Los Angeles, Pasadena and other cities have their own rent stabilization or just-cause ordinances, and they can be stricter. Always check the city where the property sits.
Next step
If you're financing a first rental, run the numbers with the DSCR worksheet and see Francisco's DSCR rental loan page.
Frequently asked questions
Does AB 1482 apply to single-family homes?
Not if owned by individuals and the lease contains the statutory exemption notice.
How much can I raise rent under AB 1482?
5% plus regional CPI, capped at 10%, over any 12-month period.
Do I need just cause to end a lease?
After 12 months of tenancy, for covered units, yes.
Sources
DSCR worksheet for a first rental: run the ratio before you offer
A fill-in worksheet to test a rental's debt-service coverage before you write an offer, with a worked example and the inputs that move it.
How to read a Loan Estimate, page by page
Where to look on the three-page Loan Estimate to compare two lenders fairly: loan terms, closing costs and the comparisons box.