Over the objections of the California Apartment Association, the Los Angeles County Board of Supervisors last week extended the temporary COVID-19 cap on rent increases until the middle of next year, albeit at a higher rate.  

The rent cap, which applies to rent controlled properties in unincorporated parts of the county, had been set to expire on Dec. 31, 2023. With the extension, it will now remain in place through the end of June 2024 — an additional six months. Supervisors, however, agreed to raise the cap from 3% to 4%. 

While CAA acknowledges the county’s decision to increase the cap rate in light of the financial challenges faced by housing providers, the association maintains that the cap should be completely lifted, as housing providers have faced considerable strain due to limited rent increases and escalating operational costs. This position echoes CAA’s earlier assertion that there is no justification for any extension of the current rent cap, originally introduced as a one-year measure to aid recovery from the COVID-19 pandemic. 

The extension of the rent cap continues to impact housing providers who have been reeling from government orders and prohibitions on rent collections, coupled with skyrocketing maintenance and operational costs. When the cap ultimately expires, L.A. County’s rent control ordinance will revert to its normal formula, which ties maximum allowable rent increases to the change in the consumer price index, with a maximum cap of 8%. 

When the cap ultimately expires, L.A. County’s rent control ordinance will revert to its normal formula, which ties maximum allowable rent increases to the change in the consumer price index, with a maximum cap of 8%.  

Los Angeles County will perform an economic study of its rent control law, which it adopted in 2019. The study, strongly advocated for by CAA, will analyze various factors that have been affecting the rental housing market, such as: 

Economic impact of COVID-19 measures: This includes the accumulative impact of the rent freeze, rent collection prohibitions, uncollected bad debt, court delay costs, and refinancing issues arising from these measures. 

Assessment of operational costs: The study will examine the implications of property insurance increases, compliance costs associated with California Senate Bill 721 (balcony inspection and retrofit), earthquake retrofit compliance, and other operational expenses like management costs, repair and maintenance, and changes in real estate taxes.