Introduction
As of August 1, 2025, landlords across the Bay Area must comply with the latest rent increase caps under AB 1482, the California Tenant Protection Act of 2019. For the next 12 months, allowable rent increases will range from 6.3% to 7.7%, depending on the county.
This shift is significant for landlords, tenants, and multifamily investors navigating one of the country’s most complex housing markets. While last year’s cap was as high as 8.8% in many counties, this year’s update reflects cooling inflation and varied Consumer Price Index (CPI) figures.
In this blog, we’ll break down the new county-by-county limits, explain how AB 1482 works, and highlight what this means for Bay Area stakeholders.
What Is AB 1482? A Quick Refresher
Passed in 2019, AB 1482 established two major protections for tenants across California:
- Annual Rent Increase Limits – Landlords may raise rent by 5% plus the regional CPI, or 10% total, whichever is lower.
- Just Cause Eviction Protections – After 12 months of tenancy, landlords must provide a legally recognized reason to terminate a lease.
The law applies to most multifamily housing built before 2005, though there are exemptions for single-family homes (not owned by corporations, REITs, or LLCs), new construction, and certain affordable housing programs.
For a deeper dive into AB 1482 basics and county-by-county rules, see our full breakdown here: Understanding AB 1482 Maximum Allowable Rent Increases in Bay Area Counties.
Bay Area 2025 Update: New Rent Caps by County
The California Apartment Association (CAA) recently updated its Regional CPI Calculator for the August 1, 2025 – July 31, 2026 period. The data confirms that all nine Bay Area counties share the same CPI measure: 1.3%.
This results in a 6.3% maximum allowable increase under AB 1482.
Here’s the breakdown:
This uniformity simplifies compliance for landlords and investors with multi-county portfolios, but the drop from 8.8% in 2024–25 to 6.3% this year still represents a meaningful reduction in potential rent growth.
Why the Caps Changed
The rent cap is tied directly to the Consumer Price Index (CPI), calculated annually in April. With inflation cooling in some Bay Area metros but remaining stronger in others, the 2025–26 rent caps reflect these regional differences.
- Lower CPI areas (like Alameda, Contra Costa, San Francisco, San Mateo, and Marin) are limited to 6.3% increases.
- Higher CPI areas (like Santa Clara, Sonoma, Napa, Solano, and Monterey) allow 7.7% increases.
This highlights how local economic conditions directly influence allowable rent growth under AB 1482.
What This Means for You
For Landlords
- The new caps still provide room to adjust rents, but strategy is essential.
- Use It or Lose It Rule: Under AB 1482, you cannot “bank” increases. If you skip this year’s allowable increase, you lose it permanently. This makes regular, modest adjustments critical for keeping up with rising expenses.
- Compliance requires serving the correct notice (30 or 90 days, depending on the increase) and ensuring disclosures are included in your lease.
For Investors
- Rent increases are not just about cash flow—they directly impact asset valuation.
- A building with consistently increased rents will appraise higher than a similar property with stagnant rents.
- If you plan to sell, keeping up with annual increases is critical. Skipping them can materially reduce the property’s value at sale.
State vs. Local: The Overlap Challenge
AB 1482 sets a baseline for the Bay Area, but local rent control ordinances may impose stricter limits.
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San Francisco, Oakland, Berkeley, and San Jose: Each has its own rent board and calculation formulas, often producing lower caps than AB 1482.
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Costa–Hawkins Act: Still relevant—it allows landlords to reset rents to market when a unit turns over, provided it’s not otherwise restricted.
Key reminder: AB 1482 sets the floor, not the ceiling—local laws can and do supersede it.
Compliance Checklist for Bay Area Landlords
- Verify whether your property is covered by AB 1482 or a local ordinance.
- Calculate the maximum allowable increase for your county (6.3% or 7.7%).
- Decide whether to implement this year’s increase—remember, you cannot bank it.
- Serve proper legal notices (30 or 90 days, depending on the size of the increase).
- Update your lease documents with the required AB 1482 language.
- Keep thorough records of CPI data, calculations, and notices.
Looking Ahead
- If inflation remains cool, expect continued smaller caps in the near term.
- If inflation spikes again, caps could increase—but they’ll never exceed 10%.
- AB 1482 is set to remain in effect until 2030, ensuring CPI-driven rent caps will continue shaping the market.
For landlords and investors, this underscores the importance of strategic rent management: regular, compliant increases protect both cash flow and property value.
Conclusion
The August 1, 2025 AB 1482 update brings a split rent cap across Bay Area counties: 6.3% in core counties, 7.7% in higher-CPI counties. For landlords, the key takeaway is simple: use your annual increase or lose it—and remember that consistent rent growth directly impacts property valuation, especially if you’re planning to sell.
Are you curious to see how your property is performing against others in the market—and whether you’re keeping up with rent growth? Contact me today for a complimentary property analysis.
And if you’re considering selling your building in the near future, remember: your rent roll is one of the biggest drivers of market value. Keeping up with allowable increases directly impacts your exit price.
The Bay Area rental market is shifting—and whether you’re a landlord planning increases, a tenant seeking clarity, or an investor evaluating returns, understanding AB 1482 is critical to protecting your interests.
Don’t leave compliance—or opportunity—to chance.
📩 Contact me today to schedule a consultation and ensure you’re making the smartest moves under the new AB 1482 rules.
