LA Amends the city's rent stabilization ordinance

December 15, 2025

On December 12, 2025, the Los Angeles City Council voted 12-2 to approve an ordinance amending the city's Rent Stabilization Ordinance for the first time in 40 years.


The changes will:

Limit annual rent increases to between 1% and 4%, depending on inflation.

Use 90% of the Consumer Price Index for calculating the annual allowable rent increase.

Eliminate the 1%–2% utility pass-through for landlords who pay for gas or electricity.

Prohibit rent increases when tenants add dependents.

Expand the occupancy exemption in eviction cases involving material lease violations to include dependents of any age.


The changes generally apply to most multifamily housing built before Oct. 1, 1978, which account for approximately 60% of multifamily housing inventory in the area. Newer buildings and single-family homes are exempt under the Costa-Hawkins Rental Housing Act, which limits the application of local rent control laws to newer construction and certain property types.

 

The City Council file (23-1134) has been forwarded to the mayor for approval and it is expected to go into effect mid-January, 30 days after the city clerk posts final approval.

 

Unincorporated areas of Los Angeles County are separately subject to the Rent Stabilization and Tenant Protection Ordinance which was amended in 2024 to switch from a 4% flat cap to a formula to tie increases more closely to inflation while providing stronger tenant protections. Specifically, it limits the annual increase of rent to 60% of the percentage change in the average Consumer Price Index, but no more than a maximum increase of 3%. The county ordinance allows for small property owners (e.g., one property with ≤10 units, or up to three properties totaling ≤10 units countywide plus outside the county) to increase rent by an additional 1% (total of 4%) and luxury unit owners (units with 2 or fewer bedrooms in buildings with 25+ units, where base rent was ≥$4,000/month as of September 11, 2018) to add an extra 2% (total of 5%).

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This update covers significant legal updates from 2025 that will affect housing providers in the coming year. We cover major laws passed by the California legislature as well as important court decisions and noteworthy local initiatives. California Legislature AB 246: Eviction Protection for Interruption of Social Security Benefits. AB 325: Common Pricing Algorithm Restrictions. AB 414: Updated Procedures for Returning Security Deposits. AB 628: Stove and Refrigerator Added to Habitability Standard. AB 747: Changes to Service of Unlawful Detainer Lawsuit AB 1414: Tenant Right to Opt Out of Internet Plan. AB 1529: Simplification of AB1482 Disclosure Requirement. SB 610: Post-Disaster Obligations for Landlords, and Tenant Right to Return to Repaired Units. AB1248: Ban on Ratio Utility Billing – Not Passed. Notable Court Decisions Eshagian v. Cepeda (C.A. 2nd, June 26, 2025): Invalidated a 3-day pay-or-quit notice for lacking service date and clear deadline. Gogal v. Deng (C.A. 4th, July 22, 2025): Lease caps on attorney fees/costs ($1,000) enforceable, but California Supreme Court has agreed to review decision. Ongoing COVID Eviction Moratorium litigation. Local Initiatives Los Angeles: Immigration Emergency Declaration. Los Angeles: Right to Counsel San Diego: Broad Limits on Rental Fees.