New Laws Taking Effect as of January 1, 2026

• Stoves and Refrigerators Must Be Supplied in All Newly-Leased Apartments: CA AB628 amended CA CC1941.1, which covers all habitability requirements for residential rentals.
  • This appliance requirement applies to all new, renewed/extended or amended leases.
  • Landlords and tenants may mutually agree at lease signing that the renter will provide and maintain their own refrigerator. This agreement must be clearly stated in the lease, with specific language stating that renters retain the right to request that the landlord provide a refrigerator with 30 days’ written notice from the renter. Landlords cannot require tenants to provide their own refrigerator as a condition of tenancy. If a tenant chooses to provide their own refrigerator the landlord will not be required to maintain it.
• AB 246 – Social Security Hardship Defense: This statute provides that if the tenant pays the rent with Social Security income, and the payments are delayed for some reason beyond the renter’s control, the renter cannot be evicted for nonpayment of rent while that payment disruption is in place, up to a period of 180 days. The law also provides that the tenant must pay all unpaid rent within fourteen days of getting the Social Security payments restored.
• Security Deposit Deductions and Pre-Exit Walkthrough: If a pre-exit inspection is conducted at the renter’s request after being informed of that right, and, at the time of inspection, the premises do not contain renter’s possessions that prevent the landlord from identifying needed repairs or cleaning due to the presence of those possessions, the landlord shall not use the security for deductions for repairs or cleanings that are not identified in the itemized statement. Anything not noticed or listed during the pre-exit walkthrough can’t be charged/deducted from the security deposit. Take pictures. If renter’s belongings obstructed the damaged or dirty areas, the landlord may charge for those repairs or cleaning. If the renter declines the pre-exit walkthrough, this restriction does not apply.  Landlords are also required to take pictures of the unit before move-in, after move-out (before any repairs/cleaning are performed), and after all repairs and cleaning have been completed. This amended CA CC1950.5.
• New Security Deposit Return Rules: If the renter paid the security deposit electronically, they must be given the option of having the refund returned electronically. The security deposit disposition may be sent by email, if that is the renter’s preference. If there are multiple adult lessees, landlords must specifically request direction as to how the deposit is to be apportioned and delivered. If no direction is given, landlords must include all lessees on one check and mail it to one of the former lessees. This amended CA CC1950.5. 
• Management Can’t Force Renters to Pay Them for Internet or Phone Service: AB 1414 mandates that landlords are required to give new and existing residential tenants the opportunity to opt out of paying for any subscription from a third-party internet service provider for wired internet, cellular or satellite service offered in connection with the tenancy. Note that even if devices can connect to the internet service wirelessly, this law may still apply. If renters are not allowed to opt out, or if they’re charged the fee after they’ve opted out, the renter would be entitled to deduct the cost of the subscription from the rent. Obviously, if a renter exercises their right to opt out, they cannot be retaliated against.
• Oakland Banked Rent Reform: While not a state statute, but a local ordinance, this revision to Oakland’s rules about rent increases based on ‘banking’ was included since many AOA members are affected. It basically reduces the past-year banking period from ten years to five years, beginning January 1, 2026 (meaning any affected rent increase would need to take effect by the end of 2025, rather than being served during that period). Currently, owners who had not imposed an annual rent increase on tenants, as permitted by the Oakland rental adjustment program (RAP), had the option of imposing those increases going back ten years. That right is now limited to five years.

Los Angeles City Council Approves 4% Rent Cap Ceiling for RSO Units

Annual rent hikes for RSO-regulated buildings will have a 1% floor and 4% ceiling. This will replace the former 3-8% range. 

• The formula for calculating allowable increases will now use 90% of the Consumer Price Index, up from the 60% recommended by the committee. 
• Landlords will be barred from imposing extra surcharges for tenants with additional dependents.

LA Committee Votes to Explore Canceling ‘Mansion Tax’ for Palisades Homeowners

The council’s vote: A proposal advanced Monday by a key committee of the L.A. City Council would exempt Pacific Palisades homeowners from the city’s “mansion tax” if they sell high-end properties for $5.3 million or more following the January fires.

What supporters say: Mayor Karen Bass pushed for the proposal, calling it “a temporary exemption that provides much needed relief.” Bass sent a letter supporting the exemption after meeting with Rick Caruso, her former opponent in the mayoral election. 

What’s next: The full council still needs to consider the proposal. If it passes there, then Bass will have to issue an executive direction with full details of what a ULA exemption would look like.  More details on this proposal here.

State Supreme Court Rejects Huntington Beach’s Fight to Avoid Building Affordable Housing

The state Supreme Court upheld a lower-court order requiring Huntington Beach to follow California laws to approve housing for low-income people – 13,368 housing units when the state sued the city in 2023.

For more on this battle, continue reading here.

Santa Ana’s Rent Control Board Ruled Unconstitutional

The ruling stems from a lawsuit filed in February 2023 by the Apartment Association of Orange County, alleging the tenant-dominated rent control board violates property owner’s due process rights under the Fourth and Fourteenth Amendments to the U.S. Constitution. 

“The effect of this ruling is to find the Rental Housing Board’s composition unconstitutional,” stated the order by Judge William Claster. “Moreover, by not including explicit language in the 2024 RSO regarding tenants not being eligible to be at-large members, there is a strong argument that the reenacted regulations contradict the voter-approved RSO on this point,” wrote Claster. “That being said, even if the post-election regulation limiting tenant Board membership is valid, the fact remains that the Rental Board is intentionally unbalanced in favor of tenants.” 

The Rental Housing Board, as engineered by rent control advocates, is very powerful. The quasi-judicial body is appointed by the city council and consists of three tenant members, two “at-large” members who are not supposed to have any financial interest in rental property, and two landlord members. 

Renters can petition to have their rent decreased and challenge capital improvement passthroughs. 

According to the U.S. Supreme Court, procedural due process “demands impartiality on the part of those who function in judicial or quasi-judicial capacities.” 

The lawsuit also alleged the structure of the city’s rent control board also violates Article 1, Section 22 of the California Constitution – a prohibition on using a property qualification as a condition for holding office. Eligibility for a seat on the rental housing board is explicitly conditioned on either a positive or negative property qualification. For example, renters have a property interest in their rental agreements, while the property qualification for serving as an at-large member of the rental board is to have no financial interest in rental property.

Another hearing will determine if the Rental Housing Board is severable from the rent control/just cause eviction ordinance, which may lead to the entire ordinance being thrown out.

Oakland Rent Adjustment Program (RAP) Fee Increased

Effective January 1, 2026, the RAP Fee will increase from $101 to $137 per rental unit.

Property owners of rental units covered under the Rent Adjustment Ordinance may pass through 50% of the fee ($68.50) to tenants, provided the fee is paid before it becomes delinquent.

Annual Rent Registration Requirement: Under the Oakland Municipal Code, owners of residential rental properties subject to the RAP Fee must also register their tenancies with RAP annually. The deadline to register and pay the RAP Fee is March 1st.

AB 723 Requires Disclosure of Digitally Altered Images

Effective January 1, 2026, housing providers and real estate professionals must disclose when listing photos have been digitally altered or generated by AI. The ad must clearly note that the image was changed and provide access (like a link) to the original, unedited image.

RealPage Agrees to Proposed Justice Department Settlement Over Rent Price-Fixing

The U.S. Department of Justice has proposed a settlement with software provider RealPage,  a provider of revenue management software and services headquartered in Richardson, Texas.

over rent price-fixing through algorithmic coordination, information sharing, and other anticompetitive practices in rental housing markets across the country.

The Justice Department alleged in the suit that RealPage’s revenue-management software has relied on nonpublic, competitively sensitive information shared by landlords to set rental prices. 

If approved by the U.S.  District Court for the Middle District of North Carolina, the proposed consent judgment would require RealPage to: 

• Cease having its software use competitors’ nonpublic, competitively sensitive information to determine rental prices in runtime operation;
• Cease using active lease data for purposes of training the models underlying the software, limiting model training to historic or backward-looking nonpublic data that has been aged for at least 12 months;
• Not use models that determine geographic effects narrower than at a state level, which is broader than the markets alleged in the complaint;
• Remove or redesign features that limited price decreases or aligned pricing between competing users of the software;
• Cease conducting market surveys to collect competitively sensitive information;
• Refrain from discussing market analyses or trends based on nonpublic data, or pricing strategies, in RealPage meetings relating to revenue management software;
• Accept a court-appointed monitor to ensure compliance with the terms of the consent judgment; and
• Cooperate in the United States’ lawsuits against property-management companies that 

The country’s biggest landlord, Greystar, agreed to pay $7 million to settle a lawsuit over the scheme.

The lawsuit: In January, Greystar, several other landlords and a software company called RealPage were accused of using RealPage’s algorithmic price-setting system to keep rents artificially high. Now, Greystar has not only agreed to pay a monetary settlement, but also said it will stop using RealPage’s software and will cooperate with the prosecution of other defendants.

Why the settlement matters: Greystar and other landlords had been using RealPage’s software to access private, sensitive rental information that allowed them to inflate rental prices, according to California Attorney General Rob Bonta. With this settlement, Greystar will no longer be able to use such tools, and a proposed agreement with RealPage would prevent the company from developing new systems to access and share sensitive information. At the end of the day, landlords could have a harder time colluding with supposed competitors to drive up prices.