California is a great place to own an investment property. Real estate throughout the state is appreciating at rates well above the national average and rental prices are hitting record-high levels. The result is good returns for California landlords and plenty of opportunities for real estate investors.
Despite these benefits, California is not the easiest place to be a landlord. California is known for having some of the most complex landlord-tenant laws in the country.
To protect themselves and their investment, California landlords need to familiarize themselves with some key state laws before purchasing or managing California real estate.
Here are a few that pro landlords are familiar with!
State-Wide Rent Control
California’s Tenant Protection Act of 2019 provides for statewide rent and eviction control laws that affect most residential real estate in the state. Pursuant to the Act:
- Landlords can only raise rent once every 12-month period; and
- Rent increases for qualifying units are capped at 5% plus inflation or 10% of the lowest gross rent charged at any time during the prior 12 months, whichever is lower.
In addition to complying with these rent-control laws, at least 15 cities in California have their own rent-control laws. If the local laws are less restrictive than the state-wide Act, they don’t apply; however, if they’re more restrictive they do apply and landlords must comply with them.
State-Specific Anti-Discrimination Laws
When advertising a vacant unit or conducting Tenant Screening, it’s vital that landlords are aware of and comply with all anti-discrimination laws. The Fair Housing Act of 1918 prohibits landlords from discriminating based on race, religion, national origin, sex, familial status, or disability.
In addition, California state law prohibits discrimination on the basis of sexual orientation, gender identity, or receipt of public assistance. California also prohibits discrimination on the basis of personal characteristics or traits.
The best way to ensure that your application and screening process complies with all federal and state laws is by having an established screening process – https://www.ezlandlordforms.com/tenant-screening-services/ – that you follow for all applicants.
It should include a complete application, a credit report, a criminal background report, and an eviction history. As part of your process, establish objective, legal factors for rejecting or accepting applicants. This will ensure that your process is fair, transparent, legal, and effective.
California has some of the most extensive laws when it comes to required language and disclosures that must be included in the lease agreement. These requirements include informing tenants about accessing the registered sex offender database, a toxic mold disclosure, a smoking policy disclosure, a flood disclosure, and a bed bug addendum. Just to name a few!
You can review all required disclosures here: https://www.ezlandlordforms.com/documents/california-lease-agreement-with-ezsign-122040/
yet most landlords find it overwhelming to make sure that they’ve provided tenants with all required language and disclosures. The best way to make sure you’re protected is to use a California-specific lease that already includes all required language, disclosures, and addenda.
California Termination and Eviction Laws
California has clear procedures for terminating a tenancy and evicting a tenant. It’s important to comply with these procedures to avoid legal problems, added expenses, and trouble getting rid of bad tenants.
To terminate a tenancy of less than one year, landlords must provide tenants with thirty (30) days notice. For tenancies of 12 months or more, landlords must provide tenants with sixty (60) days notice.
Before initiating eviction proceedings, landlords must first give tenants proper notice. Additionally, while the state-wide eviction moratorium has been lifted, landlords need to be aware of post-COVID-19 eviction requirements, which have changed the procedures for some types of evictions.
Failing to follow these guidelines can result in delays getting rid of bad tenants, additional expenses, and lots of stress for landlords.
Protect Your California Investment Property
California landlord-tenant law is complicated, and it can be hard for even experienced landlords to stay up to date on all requirements. The reality is that the best way to make sure that you’re complying with all statutes and regulations is by using a California-specific Lease. At ezlandlordforms.com, Landlords follow simple prompts to customize their lease online. It’s easy to build and guaranteed to comply with all California state laws.