Start with the year the building was first occupied and the number of units on the property. Those two facts tell a San Jose landlord which rent rule they live under, and for a lot of small owners the answer is not the city’s ordinance at all.
What the Apartment Rent Ordinance covers
The city’s Apartment Rent Ordinance, the ARO, covers apartments in buildings of three or more units that were built and occupied before September 7, 1979. The Housing Department puts the total at about 38,000 apartments.
The city lists what is outside it:
- Single-family homes
- In-law units, granny flats, and other accessory dwelling units
- Duplexes
- Condominiums and townhomes
- Units first rented after September 7, 1979
- Hotels and boarding houses rented to transient guests for under 30 days
- Nonprofit homes for the aged, school dormitories, and government-owned rentals
- Property in the unincorporated areas of San Jose
If you are not sure about a building, the Rent Stabilization Program will tell you. The number the city publishes for coverage questions is 408-975-4470.
The limit: one 5 percent increase a year
A covered apartment can take one increase of up to 5 percent in any 12-month period. Not two smaller ones. One.
There are exceptions. After a tenant moves out voluntarily, or after a lawful eviction, the rent on the next tenancy is not limited by the 5 percent rule. And a landlord can ask the city for more through a petition:
- Capital improvements. A pass-through for specified improvements finished within the 12 months before the petition. The monthly amount cannot exceed 3 percent of the monthly rent.
- Fair return. A permanent adjustment when the owner shows operating expenses exceed income.
- Joint petition with the tenant. For an additional occupant (5 percent per person) or for new or added services such as pet rent or parking.
A tenant can also bring a claim when services are cut without a matching cut in rent, or when the unit has housing code violations. A hearing officer can reduce or disallow an increase on either ground. Keep the maintenance records that prove the repairs got done.
What the city expects every year
Owning an ARO building comes with a short annual list:
- Update the Rent Registry. Occupancy and rent information for every covered apartment, once a year. The registry is how the city tracks allowable increases, so an out-of-date entry tends to surface at the worst time.
- Pay the program fee. It is billed each year alongside Code Enforcement’s occupancy permit fee. Owner-occupied units can request an exemption.
- Keep the postings current. The ARO notice goes to tenants or in a common area of every pre-1979 rent stabilized building. The Tenant Protection Ordinance notice goes up in every apartment building with three or more units.
Ending a tenancy: the Tenant Protection Ordinance
The city’s Tenant Protection Ordinance limits terminations to 13 listed just causes. Two procedural steps catch people. The notice of termination must name at least one of those causes, and a copy goes to the Housing Department within three days of serving the tenant, along with a Resources and Referrals notice handed to the tenant. Whether the ordinance reaches a duplex or a single-family home is worth a call to the program before you serve anything. Where a city ordinance does not reach the unit, the statewide just cause rule in Civil Code § 1946.2 usually does, after twelve months of occupancy.
Outside the ARO: usually AB 1482
A San Jose duplex, a 1990s fourplex, or a rented house is outside the city’s ordinance. That does not make the rent unregulated. Most of those units fall under the statewide cap of 5 percent plus CPI, at most 10 percent, unless an exemption applies. An ARO apartment, on the other hand, is exempt from the state cap because the city’s limit is lower (Cal. Civ. Code § 1947.12(d)(3)).
One wrinkle for Santa Clara County. The statute names CPI indexes for four metro areas, and Santa Clara is not in any of them. Where the Bureau of Labor Statistics publishes no index for an area, the statute falls back to the California CPI published by the Department of Industrial Relations (§ 1947.12(g)(1)(B)). Confirm the figure for your effective date before you set the new rent.
Single-family homes and condos can be exempt from the state cap too, but only with the exact lease clause the statute prescribes. Is my property exempt from AB 1482 covers that clause, and how to calculate a legal rent increase in California walks through the math. The AB 1482 calculator turns the formula into a dollar amount.
Where San Jose sits among California cities
San Jose is one of more than two dozen California cities with its own rent ordinance. The California rent control city list shows the others, and the AB 1482 rent increase limits page covers the state rule that applies wherever a city’s does not.
This is general information, not legal advice. Rules change and local ordinances vary. Confirm current requirements with your city, county, or an attorney before you act.