Governor Newsom and Mayor Bass declared a State of Emergency on January 7, 2025, in response to the Palisades Fire. During a State of Emergency, price gouging above 10% is temporarily prohibited for the next 30 days. (Penal Code 396(e) and (f)). This means that, in most circumstances, businesses cannot increase the cost of rent, goods, or services by more than 10%. Rental property owners across the state should note that price-gouging protections apply wherever displacement increases demand for housing. Price gouging is subject to criminal prosecution and can result in one year in jail and/or a fine of up to $10,000.
Rent Increase Rules
- Existing Rentals:
- Rents on existing tenancies in rental units subject to the RSO cannot be increased more than 4%, and not until it has been at least 12 months since the last annual rent increase. (To find out if your unit is subject to the RSO, visit: zimas.lacity.org. Enter your address, click the Housing tab, and RSO status will be indicated for the property.)
- Rents on existing tenancies in rental units subject to the Tenant Protections Act of 2019 (AB 1482) cannot be increased more than 8.9% within a 12 month period.
- New Rentals:
- After an emergency is declared, landlords cannot increase rental housing prices by more than 10% of the previous price. For rental housing that hasn’t been rented or advertised before, the rental price cannot be more than 160% of the fair market value set by the U.S. Department of Housing and Urban Development.
- Short-Term Rentals: For short-term rentals like VRBO or Airbnb, daily rates cannot be increased by more than 10% after an emergency is declared. If these short-term rentals switch to full-time or monthly rentals after the declaration, the rental price cannot exceed 160% of the fair market value.
State, County, and local tenant protections remain in place and in some instances, may be more restrictive or protective than price gouging protections.
Prohibited Practices
- Landlords cannot justify an unlawful price increase by offering extra services like gardening, cleaning, or utilities, or by offering a shorter lease term.
- Landlords cannot charge a higher rate just because an insurance company is willing to pay it.
- The law considers it a separate misdemeanor for a landlord to evict tenants just to re-rent the property at a higher price.
Report Price Gouging
Dial 3-1-1 to report illegally hiked rents and prices, or email att.pricegougingtaskforce@lacity.org.
Learn more about price gouging.
