If you own rental property in California especially in cities like Carlsbad, Encinitas, San Marcos, or anywhere in North County San Diego it’s essential to understand how the Costa-Hawkins Rental Housing Act affects your ability to manage rent, select tenants, and stay compliant with evolving state laws.
This law continues to provide vital protections for landlords, even as new regulations like AB 1482 and AB 1620 add complexity to the landscape of rent control and tenant protections.
In this article, we’ll explain:
What Is the Costa-Hawkins Rental Housing Act?
Passed in 1995, the Costa-Hawkins Rental Housing Act (California Civil Code §§ 1954.50 – 1954.535) was designed to limit how far local governments could go with rent control. At the time, cities like Santa Monica and Berkeley had adopted aggressive policies some even prevented landlords from raising the rent when a tenant moved out. This practice, known as vacancy control, restricted an owner's ability to reset rent to market levels.
Costa-Hawkins eliminated vacancy control and made it illegal for cities to force landlords to keep rent low after a tenant voluntarily vacated the unit. This was a major win for rental property owners, restoring their right to adjust pricing based on market demand.
Key Protections Under Costa-Hawkins
Costa-Hawkins offers landlords several important exemptions from local rent control ordinances. Under the law:
These protections provide significant flexibility for owners of qualifying properties. In many cases, landlords can charge market rent, raise rent without local restrictions, and maintain control over lease termsas long as they follow state law.
How AB 1482 Changed the Landscape
In 2019, California passed the Tenant Protection Act (AB 1482). This law imposed statewide rent caps and eviction restrictions, but it preserved Costa-Hawkins exemptions in most cases.
Here’s a simplified breakdown:
|
Property Type |
Subject to AB 1482? |
Subject to Local Rent Control? |
|
Single-family home (individual owner) |
No |
No (due to Costa-Hawkins) |
|
Condo (individual owner) |
No |
No |
|
Multifamily property built <15 years ago |
No |
Possibly, depending on local laws |
|
Multifamily built before 1995 |
Yes (AB 1482 applies if no local rent control) |
Yes (if local rent control applies) |
If you're managing a single-family rental or condo and you personally own the property (not through a corporate entity), you're likely exempt from both AB 1482 and local rent control.
However, that doesn't mean you're exempt from all compliance issues.
Introducing AB 1620: An Exception Landlords Must Understand
In 2024, California passed AB 1620, which adds a specific requirement for landlords of multifamily properties when dealing with tenants with mobility disabilities.
Here’s what it says:
If a tenant with a verified mobility disability requests to move to a comparable ground-floor unit in the same building, the landlord must allow the tenant to keep their current rent if a suitable unit is available.
This law applies only if:
Critically, AB 1620 does not require landlords to give new tenants special rental pricing or bypass qualified applicants. It only protects existing tenants with disabilities who need to relocate for accessibility.
This was a key concern for one of our clients in Carlsbad who asked if this meant they had to pass up a higher-paying, better-qualified applicant. The answer was no. Costa-Hawkins still allows landlords to set the initial rent for new tenants. AB 1620 only applies as a reasonable accommodation under fair housing law, and only to existing tenants.
Common Misunderstandings About Rent Control and Exemptions
Misunderstanding 1: "My property is exempt, so I don’t have to follow any rules."
Wrong. Even exempt properties must comply with:
Misunderstanding 2: "I can charge whatever I want after a lease ends."
Not always. You can raise rent to market rates upon vacancy, but if the unit is not exempt under Costa-Hawkins or AB 1482 applies, annual increases are capped (typically 5% + CPI, up to a maximum of 10%).
Misunderstanding 3: "If a disabled tenant asks to move units, I have to give them a discount."
Only if the tenant already lives in your building and the request meets AB 1620 criteria. You do not have to reduce rent for new applicants or choose one tenant over another.
Why This Matters for Landlords in North County San Diego
Cities like Encinitas, Carlsbad, and San Marcos may not have aggressive rent control ordinances today, but California law can change fast. Local movements may push for tighter restrictions, and new laws (like AB 1620) may affect your lease terms and tenant interactions even if you think your property is exempt.
Staying compliant is not just about knowing Costa-Hawkins. It’s about understanding how it interacts with newer laws and making sure your rental decisions don’t inadvertently violate tenant rights.
At Raintree Property Management, we’ve seen firsthand how easy it is for owners to make mistakes that lead to costly penalties, lawsuits, or prolonged vacancy. That’s why our team ensures every lease, rent adjustment, and tenant communication is legally compliant and properly documented.
What You Should Do Next
If you're not sure whether your property is covered by Costa-Hawkins if you're confused by how AB 1482 or AB 1620 might apply take the guesswork out of the equation.
Here's what we recommend:
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Click below for a free rental analysis. We’ll review your property, identify which rent control laws apply, and show you how to legally maximize your income.
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Conclusion
The Costa-Hawkins Rental Housing Act remains one of the most important laws protecting California landlords from overly aggressive rent control but it’s not the only law that matters. With AB 1482 and AB 1620 now part of the legal landscape, staying informed is no longer optional. It's essential.
At Raintree Property Management, we take the confusion out of compliance so you can focus on what matters most keeping your investment profitable and your risks low.
If you're a landlord in North County San Diego, contact us today to make sure you're protected, compliant, and earning what your rental property is worth.