California rental property owners could soon face significant new limits on rent increases under proposed amendments to the state’s Tenant Protection Act, originally enacted as AB 1482.

AB 1157, introduced today, Friday, March 28, by Assemblyman Ash Kalra, D-San Jose, would significantly reduce how much property owners can increase rents annually, changing the state’s existing rent cap from 5% plus inflation, or 10%, whichever is lower, to 2% plus inflation, or 5%, whichever is lower.

The bill would also eliminate a critical exemption for most single-family homes and condominiums from statewide rent caps and just cause eviction requirements. Under current law, these properties, if “alienable separate” from other units, are exempt from statewide rent control and just cause eviction protections. AB 1157 removes this exemption, making nearly all residential properties subject to stringent rent control and eviction regulations.

In another change, AB 1157 proposes to make these statewide tenant protections permanent. Currently, these protections, originally established under legislation passed in 2019, are set to expire on Jan. 1, 2030.

While tenant groups have pushed for tighter restrictions, the California Apartment Association has consistently warned that overly restrictive rent controls discourage investment in rental housing, ultimately worsening the housing shortage.

AB 1157 also authorizes tenants to seek damages if landlords violate rent caps and empowers the state attorney general, city attorneys, and county counsels to enforce compliance, potentially exposing landlords to increased legal risks.

CAA continues to advocate against legislation like AB 1157 that would negatively impact housing providers and only exacerbate California’s housing shortage.