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Apartment Rent Ordinance

Overview of the Apartment Rent Ordinance

In 1979, the San José City Council appointed a task force to address issues in rental housing. In July 1979, the City Council adopted a rent stabilization ordinance for mobilehome parks and apartments, and created the City's Rental Rights and Referrals Program to administer the ordinance. In 1985 the City Council voted to separate the Rent Stabilization Ordinance into two separate ordinances - one for mobilehome parks, and another for apartments. 


The Apartment Rent Ordinance, found in Municipal Code Chapter 17.23, and its companion Regulations control rent increases on apartments that are covered by the ordinance.


Webpage Sections:



Council Actions

On Tuesday, November 14, 2017, the City Council took action on the following agenda items summarized below:

Amendment to the Tenant Protection Ordinance (TPO) 

  • Include dependent child; foster child; minor in the tenant's care; spouse or domestic partner; or parent of a tenant under exempted categories of additional family members allowed under TPO's Just Cause reason for material or habitual rental agreement violation; and
  • Reduce the maximum occupancy limit for adults to the number allowed by the rental agreement or two adults per bedroom, whichever is greater. 

Revised Apartment Rent Ordinance (ARO) and Regulations:

  • Retain the limit on annual general increases as 5% with no banking;
  • Implement a capital improvement pass through petition process for specified capital improvements;
  • Defer action on Ratio Utility Billing System (RUBS) to March 2018 with additional research from staff;
  • Continue to exclude duplexes from the ARO;
  • Allow tenant buyout agreements; and
  • Maintain the rent registry as recommended by staff.  

Staffing Plan and Associated Fee Increase:

  • Approve Phase I and Phase II of the proposed staffing plan for the Rental Rights and Referrals Program with a fee increase effective on January 1, 2018.

The second reading of the Tenant Protection Ordinance and Apartment Rent Ordinance took place Tuesday, November 28, 2017, and Council approved the changes above so the ordinances will go into effect on December 28, 2017. In the weeks following, staff will begin implementing a plan to reach out to constituents with informational materials and opportunities for additional assistance and education.

Please refer to the following documents approved through these meetings:



Apartment Rent Ordinance Coverage 

Properties that are covered by San José's Apartment Rent Ordinance include apartments with three or more units that were built and occupied prior to September 7, 1979.

Rental housing developments exempted from the ordinance include single family homes,in-law units/granny flats/accessory dwelling units, duplexes, condominiums, townhomes, hotels, boarding houses rented to transient guests for periods of less than 30 days, nonprofit homes for the aged, school dormitories, rental units owned and operated by any government agency, any new rental units first rented after September 7, 1979, and properties in unincorporated areas of San José.


If you have an inquiry about a property outside of San José, please check with that specific city for more information about any regulations that may apply.

To determine if a property is rent-controlled, you can view a map of rent controlled properties, and follow these directions:
  1. Select "Multiple Housing Roster" on the menu on the left side of the screen to view properties covered by the Apartment Rent Ordinance.
    (If the menu does not automatically show when you open the map, click the blue box with the three white horizontal lines inside to open the menu.)
  2. Type in the property address at the top left and press enter.
  3. Click the tan marker indicating the address location to view how many rent-controlled units are located there.
Please note that the property information included in the map may not be completely up-to-date. 

Please contact staff at (408) 975-4480 if you have questions or to confirm the status of a particular property.

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Allowable Rent Increase Under the Ordinance 
Under the Apartment Rent Ordinance, rent increases may only be given once in a 12-month period. The maximum annual allowable increase is 5%.  

Exceptions to the Allowable Rent Increases

Rent increases that are exempt from these requirements include an increase after the rental unit has been voluntarily vacated by the tenant, and an increase after eviction of a tenant. 

A landlord can petition to pass through costs to tenants for the following reasons:

  • Specific Capital Improvements: The total monthly amount imposed may not exceed 3 percent of the monthly rent charged and not considered rent. The improvement must have been completed within 12 months prior to the filing of the petition.
  • Fair Return Increase: A special permanent rent adjustment may be approved by the City when the landlord offers proof that their operating expenses exceed income as is adjusted for by inflation.
Tenants may also file a joint petition with their landlord for a 5% increase in rent per additional occupant.

Tenants with a rent increase subject to review and/or service reduction claims or housing code violations may file a petition. 


Service Reductions
 
A service reduction has occurred when the level of service provided by the landlord has been reduced without a corresponding decrease in rent. The Ordinance allows tenants to request an administrative hearing for a service reduction claim. The tenant has the burden of proof to their claim by submitting evidence such as maintenance record requests, photographs, and/or testimony. If the claim is proven, the Hearing Officer will determine the percentage that the usability of the rental unit was reduced and the duration of the reduction. If the rent increase is unreasonable, the Hearing Officer may reduce a rent increase, order a credit against the paid and/or permanent or temporary reduction in future rent. 

Housing Code Violations
 
A housing code violation has occurred when there are health and safety defects which violate the San José Housing Code and/or California Civil Code Sections 1941.1 and 1941.2. The tenant has the burden to prove their claim by submitting evidence such as a Code Enforcement Inspection which is considered presumptive evidence.  Unless there is sufficient evidence to the contrary, violations listed in the report are considered to have been proven to exist. Issues of this type may also be classified as 'service reductions' under the City's ordinance. The Hearing Officer may reduce, disallow or reasonably condition any rent increase based on the severity of any Housing Code violations. 

Freedom to Exercise Rights
 
Apartment owners may not do the following in retaliation for tenants demanding their rights under the Ordinance: 
•Threaten to sue, evict or terminate the tenancy of the tenant(s). 
•Harass you until you leave. 
•Reduce your services. 
•Increase your rent. 
•Impose a security deposit or any other new charge. 

If any of these actions occur, provide a written complaint to the Rental Rights & Referrals Program.