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Apartment Rent Ordinance

Draft Apartment Rent Ordinance and Regulations Released for Public Review

The Housing Department has released the draft Apartment Rent Ordinance (ARO) and Regulations are available for public review and comment on August 14, 2017. The 30-day comment period will run from August 14, 2017 to September 15, 2017.

Over the past two years, the San José community has been engaged in a discussion regarding the Apartment Rent Ordinance and its role within our community. After gathering input from the community and receiving direction from the City Council, a draft ARO is ready for public review. The draft ARO includes language regarding several important issues including:

  • Annual General Increase
  • Capital Improvements
  • Petitions Filed by Tenants and Landlords
  • Hearing Process

The Housing Department is hosting three community meetings to discuss the draft ARO. Attendance is encouraged to provide feedback on the draft ARO and to understand potential changes for landlords and tenants of rent controlled apartments. The public meetings will provide an opportunity for public comment and are scheduled as follows:

 

 Date

Time

Location

Community Meeting
Thursday, August 24, 2017

6:30 –  8:30 pm

Educational Park Branch Library
1772 Educational Park Dr

Community Meeting
Thursday, August 31, 2017

2:00 - 4:00 pm

City Hall Wing Rooms

200 E. Santa Clara St

Housing & Community Development Commission
Thursday, September 14, 2017

5:45 p.m.

City Hall Wing Rooms

200 E. Santa Clara St



Apartment Rent Ordinance Overview
 
In 1979, the San José City Council appointed a task force to address issues in rental housing.  In July 1979, the City Council adopted a rent stabilization ordinance for mobilehome parks and apartments, and created the City's Rental Rights and Referrals Program to administer the ordinance. In 1985 the City Council voted to separate the Rent Stabilization Ordinance into two separate ordinances - one for mobilehome parks, and another for apartments. 

The Apartment Rent Ordinance, found in Municipal Code Chapter 17.23, and its companion Regulations control rent increases on apartments that are covered by the ordinance. At this time, changes are being made to the Apartment Rent Ordinance and additional provisions are in place. Please see the Interim Ordinance and the Revised Interim Regulations which are currently in effect. 


Apartment Rent Ordinance Coverage 

Properties that are covered by San José's Apartment Rent Ordinance include apartments with three or more units that were built and occupied prior to September 7, 1979.

Rental housing developments exempted from the ordinance include single family homes,in-law units/granny flats/accessory dwelling units, duplexes, condominiums, townhomes, hotels, boarding houses rented to transient guests for periods of less than 30 days, nonprofit homes for the aged, school dormitories, rental units owned and operated by any government agency, any new rental units first rented after September 7, 1979, and properties in unincorporated areas of San José.


If you have an inquiry about a property outside of San José, please check with that specific city for more information about any regulations that may apply.

To determine if a property is rent-controlled, you can click here to view a map of rent-controlled properties, and follow these directions:
  1. Select "Multiple Housing Roster" on the menu on the left side of the screen to view properties covered by the Apartment Rent Ordinance.
    (If the menu does not automatically show when you open the map, click the blue box with the three white horizontal lines inside to open the menu.)
  2. Type in the property address at the top left and press enter.
  3. Click the tan marker indicating the address location to view how many rent-controlled units are located there.
Please note that the property information included in the map may not be completely up-to-date. 

Please contact staff at (408) 975-4480 if you have questions or to confirm the status of a particular property.

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Allowable Rent Increase Under the Ordinance 
Under the Apartment Rent Ordinance, rent increases may only be given once in a 12-month period. The maximum annual allowable increase is 5%.  

The City Council has directed that changes be made to the Apartment Rent Ordinance. Staff anticipates that revisions to the Ordinance will be completed by the end of 2017.

Beginning June 17, 2016, an Interim Ordinance will be in effect until revisions to the Apartment Rent Ordinance are completed. The Interim Ordinance reduces the annual allowable rent increase from 8% to 5% and outlines the process for filing cost pass-through petitions.  


Exceptions to the Allowable Rent Increases

Rent increases that are exempt from these requirements include an increase after the rental unit has been voluntarily vacated by the tenant, and an increase after eviction of a tenant. 

Under the Apartment Rent Ordinance, both property owners and tenants may file a petition. Property owners who file a petition to increase rent in excess 5% must submit a cost worksheet to the Rental Rights and Referrals Program. Pending a decision by the Hearing Officer, the amount of rent in excess of 5% is deferred and only an 5% rent increase should be demanded or paid.


Starting September 1, 2016, capital improvement, debt service, operations and maintenance, and rehabilitation pass-through petitions will no longer be accepted by our office. Landlords may file a Fair Return petition if they would like to request the ability to increase rent more than 5% because of substantial capital improvements or capital expenses, unusually low rents, uninsured damage or vandalism, or other reasons. To view the petition and instructions, please click here.

Tenants with a rent increase subject to review and/or service reduction claims or housing code violations may file a petition. 



Service Reductions
 
A service reduction has occurred when the level of service provided by the landlord has been reduced without a corresponding decrease in rent. The Ordinance allows tenants to request an administrative hearing for a service reduction claim. The tenant has the burden of proof to their claim by submitting evidence such as maintenance record requests, photographs, and/or testimony. If the claim is proven, the Hearing Officer will determine the percentage that the usability of the rental unit was reduced and the duration of the reduction. If the rent increase is unreasonable, the Hearing Officer may reduce a rent increase, order a credit against the paid and/or permanent or temporary reduction in future rent. 


Housing Code Violations
 
A housing code violation has occurred when there are health and safety defects which violate the San José Housing Code and/or California Civil Code Sections 1941.1 and 1941.2. The tenant has the burden to prove their claim by submitting evidence such as a Code Enforcement Inspection which is considered presumptive evidence.  Unless there is sufficient evidence to the contrary, violations listed in the report are considered to have been proven to exist. Issues of this type may also be classified as 'service reductions' under the City's ordinance. The Hearing Officer may reduce, disallow or reasonably condition any rent increase based on the severity of any Housing Code violations. 


Freedom to Exercise Rights
 
Apartment owners may not do the following in retaliation for tenants demanding their rights under the Ordinance: 
•Threaten to sue, evict or terminate the tenancy of the tenant(s). 
•Harass you until you leave. 
•Reduce your services. 
•Increase your rent. 
•Impose a security deposit or any other new charge. 

If any of these actions occur, provide a written complaint to the Rental Rights & Referrals Program.