Annual Rent Cap Announced

State law limits rent increases to 8.6%

The new maximum annual rent adjustment allowed under California state law has been released following publication of the inflation data used to calculate the cap.

AB 1492, the statewide rent control law enacted in 2019, limits rent increases to 5% plus the regional CPI with a cap of 10% for any 12-month period.

For rental properties in the Greater Sacramento region that are subject to AB 1482, the maximum allowable increase limit is 8.6% effective July 1, 2026, through June 30, 2027. This figure is based on 3.6% regional CPI of 3.6% reported in April. State law also places a limit of one increase per 12-month period.

State law prohibits rent control on single-family properties unless owned by a corporation or REIT. Multifamily units built within the past 15 years are exempt, too.

Local rent control ordinances may impose additional rent control restrictions. In the Greater Sacramento region, only the City of Sacramento has a local rent control ordinance. For details about its Tenant Protection Program, go to the program's website at www.cityofsacramento.org/tpp or call the TPP office at 916-808-8121.

For units rented to Housing Choice Voucher participants, HUD federal regulations allow housing authorities, such as Sacramento Housing & Redevelopment Agency (SHRA), to approve rent increases lower than the AB 1482 maximum if comparable market rents do not support the requested amount.