Understanding AB1482 in San Francisco

AB1482, California's statewide Tenant Protection Act, generates all kinds of confusion and anxiety among both landlords and tenants. The San Francisco Standard recently published a well-written article on the topic. It is commonly assumed that every residential rental property in California is subject to AB1482. In reality, whether the law applies depends on the age of the property, who owns it, the type of property, and whether the owner properly claimed an available exemption.

Below are a few points to keep in mind when dealing with this confusing law. 

Background on Rent Control in San Francisco

Two laws primarily govern rent increases and tenant protections in San Francisco: the San Francisco Rent Ordinance and California's Tenant Protection Act (AB1482). Where both San Francisco's Rent Ordinance and AB1482 could apply, the law providing the greater tenant protection generally controls.

San Francisco’s Rent Ordinance went into effect on June 13, 1979. In general, San Francisco's Rent Ordinance applies to most multifamily residential buildings first occupied before June 13, 1979, although there are exceptions and special rules for certain property types. Annual rent increases are set by the San Francisco Rent Board each year based on a Consumer Price Index (CPI) formula. For the current period, the maximum increase is 1.6%.

What is AB 1482?

AB1482 went into effect on January 1, 2020. It is a statewide tenant protection law that also applies in San Francisco. It is generally more lenient with rent increases allowed so buildings subject to the SF rent control law tend to be limited more by that law. AB1482 generally applies to residential rental properties that are more than 15 years old, unless another exemption applies. As buildings age past 15 years from the date of first occupancy, many become subject to AB1482 unless another exemption applies. The rent increase is limited to 5% plus the consumer price index or 10%, whichever is lower. Most multifamily residential rental properties are subject to AB 1482 unless another exemption applies. Many individually owned single-family homes and condominiums are exempt from AB1482 provided the owner is not a corporation, REIT, or most LLCs and the tenant has received the required written exemption notice. If that notice was not properly provided, the exemption may not apply.

California law requires landlords to provide a very specific statutory exemption notice. The language must be included exactly as required by the Civil Code. Because the wording is prescribed by statute, landlords should use a current lease form from a reliable source such as the San Francisco Apartment Association or the California Association of REALTORS®.

If the required exemption notice was properly provided, the property may be exempt from AB1482's rent cap and just-cause eviction requirements, assuming it otherwise qualifies for the exemption. If the notice was not properly provided, the owner may not be able to rely on the exemption.

It's also important to remember that AB1482 generally limits future rent increases—it does not freeze rents. Likewise, when a tenant voluntarily vacates a unit, landlords can generally reset the rent to current market value before the rent cap applies to the new tenancy. 

Many people think AB1482 is simply a rent control law, but it also created statewide "just cause" eviction protections. Once a tenant has occupied a covered property long enough to qualify, a landlord generally must have one of the legally recognized reasons to terminate the tenancy.

Advice for Tenants Regarding Rent Control in SF

If you're looking for greater protection from large rent increases, consider renting in a building that is both more than 15 years old and subject to AB1482 or San Francisco's Rent Ordinance. Whether a property is covered depends on several factors, including its age, ownership structure (corporation, REIT or LLC with a corporate partner), and whether it qualifies for one of the statutory exemptions.

If you are renting from an individual who is not a corporation, REIT or LLC with a corporate partner, check your current lease to see if your landlord gave you notice of exemption. If the landlord properly provided the statutory exemption notice and the property otherwise qualifies for the exemption, AB1482 generally does not apply. If they did not give notice, you may be protected by AB1482.

Advice for Landlords Regarding Rent Control in SF

Do you own a condo or a single family residence and are looking to rent it out, and do not want to be subject to AB1482? If your property qualifies for an exemption, make sure your lease contains the required statutory exemption notice from the outset of the tenancy. Omitting the notice can unintentionally subject the property to AB1482. These are available from the San Francisco Apartment Association. Also, real estate agents in San Francisco have access to this form as well and can assist you in finding tenants and making sure you have used the correct forms when renting out your property.

Landlord Services Provided by Team Kline Real Estate

We have recently leased several San Francisco condominiums on behalf of owners and provide full-service leasing, including marketing, open houses, tenant screening, credit and background checks, lease preparation, and move-in documentation. If you would like assistance leasing your residential property, please reach out. 

Final Thoughts 

Whether you're a landlord, tenant, buyer, or investor, don't assume you know which law applies. I regularly see situations where owners believe their property is exempt when it isn't—or tenants assume they have protections that don't actually apply. Spending a few minutes reviewing the property's age, ownership, and lease documents can prevent expensive mistakes later. 

More Resources

This article written by the California Attorney General summarizes AB 1482.

This article by San Francisco discusses how AB 1482 works in San Francisco.

Disclaimer

This article is intended for general informational and educational purposes only and should not be construed as legal, tax, or financial advice. California landlord-tenant laws, including the Tenant Protection Act (AB1482), are complex and subject to change. Whether AB1482 applies to a particular property depends on the specific facts, including the property's characteristics, ownership structure, lease terms, and any applicable local ordinances.

Landlords and tenants should consult with a qualified California real estate attorney or other appropriate professional regarding their individual circumstances before making legal or financial decisions. While every effort has been made to provide accurate information as of the date of publication, no warranty or guarantee is made regarding the completeness or current accuracy of the information contained in this article.