The cost of living in San Diego has long been a topic of concern for its residents. As one of California’s most desirable cities to live in, San Diego’s housing market has seen skyrocketing rent prices in recent years. To address the rising housing affordability crisis, the city of San Diego has implemented new rent control measures. As of April 25, 2023, the San Diego City Council has put into motion new legislation that impacts both landlords and tenants significantly. The aim is to delve deep into the ins and outs of this new ordinance, offering both landlords and tenants a thorough understanding of what’s changed and what they need to be aware of.

Background on the Housing Crisis

San Diego’s housing crisis is not unique to the city. It is part of a broader issue affecting many cities in California, where skyrocketing rents have made it difficult for many residents to find affordable housing. In response to the crisis, the state of California passed the Tenant Protection Act (also known as AB 1482) in 2019, which introduced rent caps and eviction protections statewide. However, San Diego’s new measures go beyond these statewide protections to address the city’s unique housing challenges.

The City of San Diego Rent Control Ordinance for Landlords: What You Need to Know

The recent San Diego Rent Control Ordinance has brought significant changes to the landlord-tenant dynamics in the City of San Diego. As a landlord, understanding these changes will not only help you remain in compliance but also ensure you navigate the rental market with confidence and clarity. Keep in mind- this new ordinance is only in place for the City of San Diego, not the entire county. In an effort to help landlords, we’ve summarized some of the most important points below:

No-Fault Evictions: Understanding the New Costs

• Relocation Assistance: If you need to evict a tenant through no fault of their own (e.g., you decide to move into the property yourself), you will need to provide them with relocation assistance equal to two months’ rent.
• Special Categories: For tenants aged 62 and above or those living with disabilities, the relocation assistance increases to three months of rent.

Substantial Remodeling: Tightened Restrictions

• Notification: Prior to applying for remodeling permits, you are required to inform your tenants three days in advance of your intention.
• Permit Requirements: Merely applying for permits isn’t enough; you must secure the necessary permits for either demolition or substantial remodeling.
• What Qualifies as Substantial Remodel: Activities like replacing or significantly modifying structural, electrical, plumbing, or mechanical systems or getting rid of hazardous materials like asbestos all qualify as a substantial remodel. Cosmetic improvements or minor repairs do not.
• After Remodeling: If you re-rent your remodeled property within five years, previous tenants evicted for no fault of their own should be given the option to return at the same rental price.

Increased Notification and Reporting Requirements

• Evictions: For at-fault evictions (like damage to the property or unpaid rent), you’ll need to first give tenants a chance to rectify the mistake. This could mean paying off overdue rent in full and compensating for property damages. In essence, tenants should receive notices like the “3-day pay or quit,” which are specifically designed to offer them a chance to rectify their errors. Additionally, certain evictions will need to be reported to the San Diego Housing Commission within three business days.
• Renter’s Guide: You’re now required to provide new tenants with a Tenant Protection Guide, developed by the San Diego Housing Commission, at the time of signing the lease. For current tenants, this guide should be provided within 90 days of its release.

New Tenant Benefits

• Tenant Protection Guide: Landlords are required to provide tenants with a Tenant Protection Guide, developed by the San Diego Housing Commission, at the start of the lease. For those already residing in their rentals, this guide should be provided to tenants within 90 days of its official release.

Exemptions and Special Circumstances

• Single Family Homes: These are exempt unless owned by corporations, real estate investment trusts, LLCs, or mobile home park managers. However, you need to notify tenants in writing about this exemption when signing the lease.
• Accessory Dwelling Units: The new ordinance doesn’t apply to such units.
• Section 8 Housing: The new rules do not cover Section 8 housing.

Economic Implications and Considerations

• Financial Impact: The requirement of 2-3 months’ rent for no-fault evictions might be burdensome, especially for non-corporate landlords, making it essential to budget accordingly.
• Potential Market Shift: With these new rules, some experts predict fewer properties on the rental market and possible increased rents to cover landlord costs. Stay updated on market trends to make informed decisions about rental pricing.

Seek Expert Guidance

• Legal Counsel: Given the intricate details and potential penalties for non-compliance, it may be wise to consult with a legal expert specializing in San Diego’s real estate laws.
• Property Management: Consider using property management services that are up-to-date with the latest laws and can help streamline processes and ensure compliance.

The Best in San Diego Property Management

With the recent changes in rent control in San Diego, landlords and tenants may find navigating the new regulations a bit daunting. This is where expert assistance can be invaluable. If you’re a property owner unsure about these new regulations, don’t risk potential legal challenges. Reach out to AllView Real Estate to manage your questions and concerns.

The team at AllView Real Estate is highly experienced in property management across San Diego County, Orange County, and Los Angeles County. Whether you’re dealing with apartments, luxury homes, or investment properties, the professionals at AllView are here to help you optimize your rental experience. Connect with us online or call us at (949) 400-4275.

Disclaimer: AllView Real Estate does not provide legal advice. This material has been prepared for informational purposes only. All users are advised to check all applicable local, state, and federal laws, and consult legal counsel should questions arise.