Rent Stabilized Rents Will Jump 3% in September, the Largest Increase in Years

Landlords can raise monthly rents for rent-stabilized apartments in West Hollywood by 3% in September, two-thirds more than last year’s permitted increase and the highest jump in recent years.

The allowable increase will take effect on Sept. 1 and be in effect through Aug. 31, 2019. Property owners may levy it on a tenant who has lived at least a year in his or her apartment or if that tenant has gone without a rent increase in previous 12 months.

The increase in September 2017 was 1.75%. In September 2016 it was 1% and in September 2015 it was 0.75%.

The allowable rent increase is calculated yearly as 75% of the increase in the Consumer Price Index for the greater Los Angeles region, which is determined by the federal Department of Labor’s Bureau of Statistics. That calculation showed a CPI  increase of 4.1 percent in May over the same month the year before.

The rent increases apply only to rent-stabilized apartments, which make up 93% of the city’s rental housing units and house 78% of WeHo residents. Rent-stabilized units are those built before July 1, 1979. While owners of rent-stabilized buildings must limit rent increases to the city’s designated percentage for existing tenants, they can raise the rent to the market level when a tenant moves out.

West Hollywood, like many other cities in Southern California, has a major housing shortage that economists see as the prime reason rents and housing costs are so high. The 2016 Housing Report released by the city last year says that more than half the city’s residents are “rent burdened,” meaning they spend 30% or more of their income on rent and thus may face challenges paying for food, clothing, transportation and medical care.

The report paints a picture of a city with a small pool of households inhabited by moderate-income residents (17%) and a much larger number of very-low and low income households (41%) and of more relatively affluent households (43%).

  1. And then there is the additional $6 PER MONTH that the tenants pay for the landlord to register their unit with the City. Then there is the pass-through to tenants (expected to be $30 to $40 per month) for the soft structure buildings being retrofitted. Clearly some current WEHO residents are going to have to leave West Hollywood. Just sayin’. I really do not know what the answer is, but I do know that a fixed income only goes so far.

  2. 3% is a huge increase in an environment where rents and the cost of living are already outrageous and there is talk of trying to pass on retrofit costs to tenants who have no investment stake in properties. West Hollywood, please take note and take care of your residents.

  3. Having a roof over one’s head is a basic human necessity. Economists are not interested in basic human needs. They only see money. However, Government should/needs to step up and take meaningful measures to insure that housing is available to all citizens. Without a state-wide law that addresses this then the working-class, retired and others less fortunate will be screwed.

  4. I knew, that with wealthy individuals & VC having bought up many properties, that higher rent increases would occur. Rising costs are prevalent all over CA.

    That is the only greedy part of this equation.

    I don’t like it.

  5. The city of West Hollywood, which has so much money as we know, ould tax developers 5% each. And make them pay the difference. They’re all greedy white man.

    Let’s face the fact, we live in a greedy grubby country. The dollar is the God.

    That’s what everyone wants. Including the five corrupt political hacks on the West Hollywood City Council.

    Three of the younger members can be dumped in the next election. Unfortunately, we’re stuck with the two senior citizens for another two years. The Johns!

    1. How much would a tax of 5% on developers (do you mean on development?) bring into the city coffers?

      Considering the cost to construct an affordable unit is around $450,000+ per unit and the City already requires developers to make 20% of their units affordable (in buildings of 10+ units, otherwise in buildings with less than 10 units the developer can opt to pay an “in-lieu” fee to the city’s Housing Trust Fund).

      I worry that replacing our very strong inclusionary housing ordinance with a flat 5% tax on development, we will end up with less affordable housing units. I also worry that adding the 5% tax on top of the already strong inclusionary housing requirement, all we do is raise the cost of building which means less affordable units and fewer market units but at even higher “luxury” costs – a lose lose scenario.

      The goal should be to reduce cost of building so that the end cost of the market rate unit is lower, right?

  6. I guess Randy is pro-landlord or rather is a landlord, who wants to get rid of all affordable units.

    One time I was at city hall 7 years ago and mentioned affordable and section 8 and out of no where someone overhearing my conversation walked up behind me when a rent stabilization employee on duty went to retrieve my paperwork, and blatantly said
    “ I don’t care for there to be affordable units or rent control and don’t care about section 8 what-so-ever!”

    How rude and insensitive these for profit landlords or property flippers or developers only interested in renting temporary housing, corporate or for wealthy jet setters or trying to make or turn affordable units and make them short term Condos leases!

    We might as well just call rent control future mini boutique hotels because that’s what they are doing and in reality are becoming!

    1. 3% has been the rate in the City of Los Angeles since 2011. West Hollywood is very tenant favorable when dealing with rental increases. Both cities use the consumer price index as their baseline.

  7. I have lived in West Hollywood for 7 years and got priced out previously because a landlord changes their mind to make units market instead of affordable!
    I am dealing with low income and rent increases every year. More the rent the more you pay in percentage. It’s only going up from here, and I am moving into a community housing unit for this reason. The City of Beverly Hills has capped all rent increases at 3% since last year and West Hollywood for the first time will surpass what most realize is it’s somewhat more affluent sister city with the same amount or percentage of rental housing. The increases will mean close to a $50-70 or even $100 dollar increase a month to an average rent controlled unit. This is out-of-the-option for me! People just remain in the same unit all their lives that the standing joke or comment is waiting for a person to go to a nursing home or die. This is making housing opportunities slim and making every low income household each other’s competition. You should see behaviors at open houses, people clammer to get their applications approved! Furthermore, the city failed to uphold its low income and section 8 requirement as a 10-20% percentage of new units in new buildings being built be provided—but no! The caviat is those developers turned around and made them temporary rentals or even worse Corporate Housing! So the developers bit the nose of the city to spite it’s face! They said they were ignorant but they city turned a blind eye not to advertise their stupidity with lack of oversight and or enforcement, At my and other people’s detriment. I lost 4 housing opportunities over this excuse and I am infuriated! The city seems to have these owners swap hands and make back alley deals with other owners or developers that want to buy them out or they get the tax breaks to build then leave the property off so no longer having to be held to account of abiding by city ordinances anymore since they sold the property. The goal is they all make a hefty profit then leave it in the hands of another developer and the cycle repeats!
    What more excuses do we need to price each of us low income people out of our city. You wonder why you have wealthy yuppies who live liberal but vote for republicans or act conservative or have more straight clubs popping up , it will ruin this city and make it more affluent and less liberal than ever before! Just look at the populations moving into Avalon movie town plaza, guess what they said to me, the Domain, Dylan or the Huxley should have had affordable but the city didn’t realize or enforce the ordinance so they got away with not renting to me! even the luxury apartment properties off labrea and Willoughby that fall in the city of Hollywood (proper) swiping weho’s name for cache. In with the well-to-do and out with the long term or longtime residents who either die off or get priced out unless you get lucky to qualify for a low income waitlists that can span 5-15 years, depending on the area of West Hollywood the property is at or even if you meet the criteria. Now all of us are lumped into the same category to compete with each other for limited low income units! West Hollywood is a victim of its own success for an in-demand community of wealthy entertainmen firms, app companies and Hollywood silicon east that it’s been bestowed compared to Venice’s silicon beach. West Hollywood is the inland version of Venice that is becoming more heterosexual and less gay populated, more divisive within the gay community that you must have earning power or affluence and influence. This community is more about image and having bragging rights and less about being affordable, and less probable to remain in for more than a decade! If you wonder if ever there will be a more fiscal or monetary conservative or more straight heterosexual families or median income of $50,000 plus not realizing those of us people who have beautified so they could take over just look at the hospitality condos and money or industry running campaigns look no further than here! West Hollywood proper and Beverly Hills are the top 10-20 wealthiest cities in all of the United States. You think that speaks liberal? I think not!

  8. The law allowing landlords to raise the rent to market rate between tenancies has created perverse incentives for greedy landlords to harass and threaten their long term tenants in an effort to force them out of their units. Either more aggressive enforcement to control landlord behavior is necessary or changes to the law to remove this incentive is necessary. The West Hollywood Rent Stabilization Department is essentially broken by the current flood of disputes between landlords and their tenants over the amount the landlords are trying to charge their long term tenants. Something needs to be done, soon or it will be too late for those of us who call West Hollywood home. If the landlords have their way, this will be a community of transient tenancies only and no long term residents…

    1. I’ve never heard of any place that allows restrictions on rent increases when there is a tenant turnover. That includes Los Angeles and San Francisco. If you know of a place that does this, I’m seriously curious to know.

      I own a place with one tenant. Things were not always this crazy. If I was told when I invested in my property that I had to abide by a percentage increase regulated by the city even if I had turnover in my rental, I’m not sure I would have invested. As crazy as things are now, that would’ve seemed like a very risky gamble in 2004.

      Let’s say, for the sake of argument, that you have a tenant in your unit that has been there since 1999. Paying 50% of current market rent. You think the next tenant getting a 3% increase over that 50% of market rent is a fair deal for both sides?

      Rent control was created for people who want to stay put where they are.

      1. What RobbyDobby is referring to is “strict” rent control (aka “vacancy control”). Under “vacancy control” or “strict rent control”, when a tenant vacated the apartment, the landlord could only raise the new rent for a new tenancy to a certain level (for example, I pay $1,000/month rent and move out, the landlord could only increase the rent say 10%, setting the new rent at $1,100/month; If I were to have remained a tenant in the unit, the landlord would only be able to increase my rent by the annual adjustment which this year is 3% making my new rent $1,030/month.) . The Costa Hawkins Rental Housing Act removed a city’s ability to place limits on the rent when a unit becomes vacant voluntarily by the tenant or as a result of a just-cause eviction. This is referred to as “vacancy de-control”.

        It should be noted that this “strict” form of rent control is the basis for almost every single economists’ negative analysis of rent control because it provides little incentive for investment in new rental properties if such limits are placed on profits, but in reality, there were only 5 cities ever to even have such strict forms of rent control. Those cities were: Berkeley, Santa Monica, Cotati, East Palo Alto and West Hollywood. The two largest cities well known for rent control policies, San Francisco and Los Angeles, have never once had “strict” rent control (aka “vacancy control”) yet you will hear Apartment Associations and Realtor Associations spread fear throughout the community as they claim that a repeal of Costa Hawkins would revert us all back to a time when landlords had no control over being able to make a profit and it will stop all new development of rental housing — pure lies and you shouldn’t be fooled by it.

      2. Randy, many cities across California could & would enact Vacancy Control (restrictions on rent increases when there is a tenant turnover) if Prop 10 is successful in over-turning Costa Hawkins this November election.

    2. From personal stories ((20+ yr WeHo resident) all the hoopla about the city housing providing assistance to wrongful evictions, has meant a show, but zero legal or other RRAL assistance. Then once wrongfully evicted, they are no longer WeHo residents and can’t even complain, let alone get redress, from the City, City Hall Housing Authority … And go missing from our WeHo population/community forever.

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