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If you do not live in a rent-controlled apartment, there are no restrictions on rent increases other than those imposed by your lease or rental agreement.
Some increases (i.e., pass-throughs that are not the normal allowable yearly rent increase) require Rent Board approval, others do not. It is a good idea to check with The Housing Rights Committee or the Rent Board to determine if your increase is legal. Since there are some statutes of limitations, it may be difficult for you to rectify an improper increase later.
Landlords are allowed annual rent increases set by the Rent Board. On March 1st of every year, the Rent Board publishes the allowable rent increase for the following twelve months. Annual rent increases do not require Rent Board approval. However, a tenant must be given a written 30-day notice of a rent increase (unless it's more than 10%, then it's a 60-day notice).
Banking is when a landlord chooses not to impose a rent increase at the time it comes due, but instead imposes it in a later year. Increases can be banked back to 1982. Remember, if the increase is 10% or more, then the landlord must give a 60-day notice.
To calculate the proper
amount of a banked increase, it is necessary to know
the allowable rent increase for each year. When
figuring out the banked increase, add up all the
percentages for the years, for example, .8 + .6 =
1.4%. Multiply the 1.4% by the base rent and you have
the amount the rent can be raised.
Until March 1,
1984 the allowable increase was 7.0%.
If it's obvious that your rent has been wrongfully increased (for example, the allowable increase is 1% and the landlord is trying to raise it 3%), you can file a Summary Petition at the Rent Board.
ILLEGAL RENT INCREASE
This petition alleges a wrongful rent increase and requires the Rent Board to hold a hearing. If the Rent Board determines that the increase is illegal, the rent will be reset to the correct amount and the landlord will be ordered to refund the entire increase for the period it was incorrect. Rents can be re-funded going back three years.
OTHER INCREASESLandlords can increase tenants' rent to cover increases in the cost of utilities such as electricity and water. Utility increases do not require rent board approval but paperwork must be filed with the Rent Board.
If landlords pay the PG&E and water bill and can show that these costs have gone up, they are allowed to pass the increase in costs onto the tenant. Also, if the landlord pays the water bill and is fined because too much water was used in the building, the landlord is allowed to charge the tenants in the building a portion of that penalty, as long as there are water conversion devices installed in the bathrooms.
Ordinance rules specifically state how these
passthroughs are calculated. It is a good idea
to check the rules to make sure the increase
has been calculated properly. A tenant is
entitled to proper notice before paying for a
utility passthrough. Ask the landlord to
provide documentation, i.e., a copy of the
bill for past and current months, that proves
that the rates have gone up significantly.
no Rent Board approval is needed for bond
A landlord may
petition the Rent Board to pass on to tenants
the costs of renovations to the property. This
includes work that prolongs the life of the
building, such as roof replacement, exterior
painting, seismic retrofitting, etc. Capital
improvement rent increases cannot occur without
the Rent Board’s approval. In order to pass on
these costs, the landlord must first petition
the Rent Board and receive approval. The Rent
Board sets up a hearing before it grants
approval. Tenants have the opportunity at the
hearing to argue against the petition.
The landlord must
submit a petition for a capital improvement
increase to the Rent Board before she can pass it
on to tenants. A landlord must provide proof of
the cost of the project. Info on what work was
done and to which tenant the increase applies must
also be included. The Rent Board then sets a
hearing date and notifies affected tenants by mail
at least 10 days prior to the hearing. The tenant
may file a written response at any time before the
that as many tenants in your building as
possible attend the hearing. Information from
both landord and tenants and/or their
representatives may be submitted. The Hearing
Officer will question the landlord and review
the documents, then open the record to tenant
questions and evidence. The Hearing Officer will
consider the past history of rent increases, as
well as failure to perform ordinary repairs, and
to comply with applicable state and local law.
The work was
either necessary only because of deferred
maintenance (the landlord neglected repairs), or
was unnecessary and only undertaken for purposes
of “gold plating.”
You objected to the work; it was not done in response to health or safety concerns or to reduce maintenance costs.
The landlord didn’t spend as much as he claims or got insurance money to cover the costs.
The work is
overly luxurious or more costly than required.
CAPITAL IMPROVEMENT PASSTHROUGH RULES
Buildings with 1 to 5 units
100% of the certified costs of capital improvements may be passed through to the tenants. Amortization (period over which payments are stretched) schedules are 10, 15 and 20 years. Capital improvement rent increases are limited to 5% of base rent at the time the petition was filed or $30, whichever is greater, in any 12-month period.
Buildings with 6 or more units
Only 50% of the costs of improvements can be passed through. Amortization schedules remain 7 and 10 years; rent increases limited to 10% of the tenant’s base rent at the time the petition was filed or $30, whichever is greater, in any 12-month period. In place of the above, a tenant may elect to have 100% of the costs passed through to the tenant, with an annual limitation of 5% and a total limitation of 15% of the tenant’s base rent applicable to the capital improvement rent increases. (Note: This option may be chosen within 15 days after a decision on a 50% passthrough is mailed to tenant.)
100% of the
certified cost of seismic work required by law
(and other work required by laws enacted after
11/14/02) may be passed through, subject to the
10%/$30 limit. Amortization schedule is 20
years. (Note: Seismic work not required by law
follows the regular scheduled according to
building size.) 100% of the cost of energy
conservation work approved by the Commission on
the Environment may be passed through and there
is no annual limit on amount of the passthrough.
(At present, EPA energy-star-compliant
refrigerators are the only items approved for
All capital improvement petitions which request certification of more than $25,000 in costs must include copies of either competitive bids for the work or copies of time and materials billing for work performed by all contractors and subcontractors. Otherwise, landlord must pay for an estimator hired by the Rent Board. Rent Board may not certify work required to correct code violations for which an NOV (Notice of Violation from the Dept. of Building Inspections) remained unabated for 90 days unless the landlord made timely good faith efforts to complete the work within the 90-day period.
For more information, you can call us or stop into our housing rights clinic, Monday-Thursday, 1-5pm, 415-703-8644.
Some Quick Tips:
If you live in a rent-controlled apartment, the landlord can only raise the rent a small amount each year, an amount determined by the Rent Board.
If your landlord does not charge you the annual rent increase, he can go back in a future year and take that increase. If he has not raised it for many years, he can take all those increases at once. There is no limit to how many years he can go back at once.
A landlord can petition the Rent Board to raise your rent because of capital improvements he did to the building or your apartment. See the section to the left on the rules for a capital improvement passthrough.
Bond measure passthroughs do not require Rent Board approval. Utilities passthroughs require filing at the Rent Board, but not necessarily Rent Board approval. We suggest calling the Rent Board (252-4602) for advice on your particular situation.