In San Francisco, a lot of domestic renters are covered by the San Francisco Rent Ordinance which provides lease control and simply trigger for expulsion. This means rents can just be raised by certain quantities each year and the renter can only be kicked out for "just triggers." In addition, some rentals have restrictions on just how much the proprietor can charge the new renter due to previous expulsions. The Rent Ordinance is administered by the San Francisco Rent Board.

Effective January 1, 2020, there is state rent control and simply cause required for eviction for numerous property systems not covered under the Rent Ordinance. If the system does not fall under an exemption, then it is covered. For the systems covered just under California rent control, yearly lease boosts are capped at 5 percent plus the cost of living increase or 10 percent, whichever is lower, for renters who have actually occupied the system for 12 months or more.

The Rent Board site has extensive info about the Rent Ordinance and you can download the San Francisco Rent Ordinance and Rent Board Rules and Regulations or come to our counseling clinic for more info about the Rent Ordinance or state law. Tenants who do not have rent control can have their lease increased by any quantity at any time with a correct written notice.

Major Components of the Rent Control Under the Rent Ordinance

- Landlords can only raise an occupant's rent by a set quantity each year (connected to inflation). Landlords can also petition for other increases. Notably, capital improvements can be gone through to the tenant for a maximum boost of 10% or increased operating and upkeep expenses for an optimal boost of 7%, but these lease boosts should be recorded and approved by the Rent Board before they can be enforced. The tenant can request a hardship exemption for the capital improvement and operating and upkeep passthroughs.
- Tenants can petition the Rent Board to reduce their rent if the landlord has actually failed to offer concurred upon or legally needed services-e.g., the property owner eliminates storage space, parking, washer/dryer, etc or the property manager stops working to keep the premises as safe and habitable (e.g. the house has uncorrected housing code infractions).
- Tenants can only be forced out for one of 16 "simply causes" unless the occupant shares the rental system with their landlord. The majority of these evictions deal with accusations the renter can contest (e.g., renter is breaking the lease) however some are "no-fault" like owner relocation in or an Ellis Act eviction.

Rent Control Coverage Under the Rent Ordinance

If you reside in San Francisco, you are normally covered by lease control. The major exceptions are:

- You reside in a rental with a certificate of tenancy after June 13, 1979, with a few exceptions. This "new building and construction exemption" is the biggest exemption in San Francisco. The Assessor's database, is where you can normally find out the date your building was constructed which will offer the approximate date for the certificate of tenancy. Illegal units do not have a certificate of occupancy, so are covered under the Rent Ordinance unless exempt for other factors. Some "accessory systems" frequently called in-law systems are still covered under lease control in spite of having a certificate of occupancy issued after June 13, 1979. (SF Administrative Code Section 37.2( r)( 4 )( D)) Unauthorized systems that existed before June 13, 1979 and were brought up to code after that date are likewise still covered under lease control. However, reliable January 19, 2020, these more recent systems are no longer exempt from the rest of the Rent Ordinance due to their certificate of tenancy date.
- You reside in subsidized housing, such as HUD housing tasks. Tenants with tenant-based help such as Section 8 coupons are still covered by the eviction protection of the Rent Ordinance, and sometimes covered by the lease control of the Rent Ordinance. Make a visit with the Housing Rights Committee of San Francisco for support for subsidized housing.
- You live in a domestic hotel and have less than 32 days of continuous tenancy.
- You reside in a dorm, medical facility, abbey, nunnery, etc- You reside in a single family home (see below).

Single Family Homes Including Condos Have Limited Rent Control Coverage

You typically do not have full rent control defense if you reside in a single household home (a single household home with an unlawful in-law system counts as a 2-unit structure) or a condo and you (and your roomies) moved in on or after January 1, 1996. While these units do not normally have limits on lease increases, they do have "just trigger" eviction defense (unless otherwise exempt for reasons such as above), meaning you can only be evicted for one of the just triggers unless the renter shares the rental with their landlord.

Exception: If you moved into a single family home which was uninhabited since the previous tenant was forced out after a 60 or 1 month expulsion notice (a no-fault eviction), then you have complete lease control defense. (You can discover if there was a previous expulsion by going to the Rent Board site or searching for the landlord's name on the California Superior Court's site.)

Exception: If you moved into a single family home or condominium which had housing code offenses that were pointed out and uncorrected for a minimum of 6 months before the vacancy, then you have full lease control. You can find out the code violation status of your structure at the Department of Building Inspection's website.

Exception: If you live in a condo where the subdivider of the structure still owns the apartments, you have complete lease control defense, unless it is the last unsold system and the subdivider lived in the system for a minimum of a year after neighborhood.

Commercial Units Used as Residential with the Landlord's Knowledge Are Not Exempt from Rent Control

Commercial spaces or live/work systems in which occupants continue to reside in a nonresidential system with the knowledge of the property owner are covered by lease control unless exempt for other reasons. Whether the property owner actually knows that individuals live there and allows the renters to live there is what counts.

Rent Increases Under the Rent Ordinance

Tenants with rent control can only be offered lease increases based upon what the law enables. Each year, a property owner can provide renters an annual lease boost, which is based upon the Bay Area Consumer Price Index (i.e. inflation). Landlords can likewise hand down some expenses to occupants instantly (without needing to petition the Rent Board), including 50% of recently adopted bond steps, increases in PG & E expenses (when paid by the property owner), and a part of the yearly "Rent Board Fee" which funds the Rent Board. In addition, proprietors can petition for "capital enhancement" rent increases and "running and upkeep" lease boosts. If renters think they have actually received an illegal lease increase (now or in the past) you ought to come in to the SFTU drop-in clinic for advice on filing an Illegal Rent Increase petition at the Rent Board to get your lease overpayments refunded and your rent set properly.

Annual Rent Increases

The yearly lease increase (file 571) can be enforced on or after the renter's "anniversary date." The lease increase can not be offered quicker than 12 months from the last increase, the "anniversary date." It can be given after, in which case that date becomes the brand-new anniversary date. Annual increases can be "banked" by the landlord and imposed in later years.

90 Day Notice Required For Rent Increases More Than 10%

State law (California Civil Code Section 827) needs a 90 day written notification for any rent increases which, alone or cumulatively, raise a tenant's lease by more than 10% within a 12 month duration. Rent increases for 10% or less need an one month notification. This covers both rent regulated and non-rent regulated units.

Capital Improvement Rent Increases

One of the more unjustified parts of lease control is the capital enhancement passthrough. Capital improvements are improvements for the building, the property owner's financial investment, which renters primarily spend for through a passthrough. Not just can the landlord get the renters to pay for increasing the worth of his or her financial investment, the property owner can then compose the expense of the improvements off in their taxes. Capital enhancements are things fresh windows, a brand-new roofing, painting of the exterior of the building, and other comparable enhancements to the residential or commercial property which add substantially to the life or value of the residential or commercial property as opposed to routine upkeep. Landlords must complete the work, petition the Rent Board and win approval of the lease boost before the expense can be passed on. Tenants can object to the boosts at the hearing on specific premises, like that the work was never done, was not necessary, or was done to gentrify the structure, however it is tough to stop such a passthrough in its totality. However, the tenant might get approved for a hardship exemption.

Once the capital enhancement has been spent for, then the tenant's rent goes back to what it was prior to the passthrough (plus any permitted boosts in the interim); capital enhancement rent increases are not part of your "base lease," meaning the yearly boost portion estimation does not consist of the capital enhancement passthrough.

Capital Improvement passthrough lease increases differ based on the size of the building:

Tenants in Buildings with 5 or Fewer Units
Tenants in these smaller sized structures will have to pay off 100% of the expense of the capital enhancement with rent boosts of 5% annually up until the whole amount is paid off. For example, if the brand-new roofing costs $5,000 in a 2 unit structure, each renter has to pay $2,500 and will have their rent increased 5% annually until their share ($ 2,500) has been paid.

Tenants in Buildings with 6 or More Units
Tenants in these bigger buildings (where most large capital enhancements rent increases happen) have an option of either spending for half of the capital enhancement (i.e. landlord pays 50%, tenant pays 50%) and after that getting annual rent boosts of 10% up until the capital improvement is paid off or the occupant can choose to spend for 100% of the capital enhancement and get annual lease increases of 5% annually, up to maximum of 15% (or the equivalent of 3 years of lease boosts). The option in these larger buildings can be made individually by each tenant and which one is finest will depend upon factors such as the expense of the capital improvement, what the renter's base lease is, and how long the tenant intends on living there.

Operating & Maintenance Rent Increases

Operating and maintenance rent boosts are for increases in the proprietor's expense of operating the residential or commercial property. For the property manager to be able to hand down one of these operating and upkeep lease boosts, the increased proprietor expenses need to surpass the annual lease increases. In other words, if the landlord's expenditures increased 2% and the annual boost that year is 2.2%, then the property owner would not be qualified for this rent boost. In identifying whether or not a proprietor can get an operating and upkeep rent boost, the expenses are aggregated, or looked at in overall. To put it simply, a boost in one location (e.g. taxes) might be offset by a reduction in another location (e.g. repairs). If when all is calculated the property owner can get the operating and maintenance rent increase, the lease increase is just the quantity over the yearly boost. So if the annual increase is 2.2% and the property owner's costs go up 3.2%, the landlord might get a 1% operating and maintenance rent boost. The renter's rent will not increase by more than an additional 7% beyond the annual allowable increase and the boost enters into the base rent. The renter may get approved for a difficulty exemption.

Effective July 15, 2018, amendments to the Rent Ordinance advocated by the Tenants Union limit proprietors from looking for lease boosts on existing occupants due to boosts in debt service and residential or commercial property tax that have actually resulted from a change in ownership, and prohibit property managers from seeking lease increases due to increased management expenses unless the expenses are affordable and required.

PG&E Passthroughs

Tenants who do not spend for PG & E can have their lease increased when PG & E costs increase. PG & E passthroughs need to be part of the Operating and Maintenance Passthrough process but instead ended up being a separate automatic passthrough when rent control was passed in 1979. These, too, are very unjust as occupants currently pay for utility increases as part of the yearly lease boost, which is based upon the Consumer Price Index (CPI). Generally, if the proprietor is determining the increase based on the previous 2 calendar years, the landlord needs to file a petition with the Rent Board before handing down the boost to tenants. If, however, the property manager utilizes an earlier "base year" (as the majority of proprietors do), they do not need to submit a petition with the Rent Board but must file their estimation worksheet with the Board (and attach a copy to the renter's lease increase notification). The "base year" for calculating the increase is 2002 for any tenancies existing since 12/31/2003 and the year preceding the move-in date for occupancies which began after December 31, 2003. Tenants can submit a petition challenging the increase and get a hearing if they disagree with the property owner's calculations or demand a hardship exemption.

Hardship Exemption

The Tenant Financial Hardship Application (offered from the Rent Board in several languages) can be submitted at any time after receipt of the notice of rent boost or the choice from the Rent Board is provided, whichever is earlier, for petitions for capital enhancement passthroughs, general bond passthroughs (effective 12/6/19), water earnings bond passthroughs, utility passthroughs, and operating and maintenance expense boosts. The renter need not pay the authorized rent boost while the appeal is being processed and thought about.
Each occupant in the system who is at least 18 years old, other than for subtenants, need to send documents under charge of perjury that the authorized rent boost will constitute a monetary difficulty for among the following reasons:

1. Tenant is a recipient of means-tested public support. Or
2. (a) Gross family income (this would include all roomies) is less than 80% of the current Unadjusted Area Median Income as released by the U.S. Department of Housing and Urban Development for the "Metro Fair Market Rent Area" that includes San Francisco (income limitations on the Rent Board form). And
( b) Rent is greater than 33% of gross family earnings. And
( c) Assets, omitting retirement accounts and non-liquid assets (such as automobiles, furniture, and so on), do not go beyond property amounts allowed by the Mayor's Office of Housing when determining eligibility for below market rate home ownership (property limitations on Rent Board kind). Or
3. Exceptional scenarios exist, such as excessive medical expenses.

Rent Board Fee

The Rent Board is funded by an annual charge examined on rental units covered by lease control. Landlords can pass on to renters 50% of the charge. Similar to the annual rent increase, the Rent Board Fee (file 573) can be banked. Landlords can subtract the Rent Board cost from security deposit interest or bill occupants straight. Tenants can not be evicted for nonpayment of the Rent Board cost.