California property glossary
Tenant Protection Act (AB 1482)
Also called AB 1482, statewide rent cap, just cause eviction law
Quick answer
The Tenant Protection Act of 2019 caps annual rent increases at 5% plus local inflation with a hard ceiling of 10%, and requires a landlord to state a just cause before ending most tenancies once a tenant has been in place for twelve months.
Key facts
- Rent cap
- 5% plus the local change in the consumer price index, never exceeding 10% in a twelve-month period
- Just cause trigger
- Generally after twelve months of occupancy
- No-fault causes
- Carry a relocation payment to the tenant
- New construction exemption
- Housing built within the preceding fifteen years — a rolling window, so buildings enter scope with time
- Single-family / condo exemption
- Available where the owner is not a corporation or comparable entity AND the required notice of exemption was served on the tenant
- Local ordinances
- Where a city's rent stabilisation or just cause rules are stricter, those apply
What it means
The rent cap and the just cause requirement are separate rules that usually travel together. The cap limits how far rent can rise in a twelve-month period. Just cause means that after a tenant has been in place for a year, a landlord must state a permitted reason to end the tenancy, and certain no-fault reasons carry a relocation payment to the tenant.
Exemptions matter as much as the rule. Housing built within the preceding fifteen years is generally exempt on a rolling basis, so a building moves in and out of scope with time. Single-family homes and condominiums can be exempt where the owner is not a corporation or comparable entity and where the required notice of exemption has actually been given to the tenant — a notice many owners never served, which leaves the exemption unavailable in practice.
Local ordinances sit on top of this. A number of California cities have their own rent stabilisation and just cause rules that are stricter than the state floor, and where they apply the stricter rule governs. The statewide Act sets a minimum, not a ceiling.
For an owner selling a tenant-occupied property this shapes what can and cannot be offered. A sale does not by itself end a tenancy, and an intention to deliver the property vacant runs directly into just cause and, where applicable, relocation obligations. Buyers price that difference, which is why a tenant-occupied sale, an agreed buyout, and a vacant sale are three different transactions rather than three versions of one.
Why this matters when you are selling
For an owner selling a tenant-occupied property, this determines what is actually on the market. A sale does not by itself terminate a tenancy, and an intention to deliver the property vacant collides directly with just cause and, where a no-fault reason is used, with relocation obligations. That is why a tenant-occupied sale, a negotiated buyout, and a vacant sale are three different transactions with three different prices rather than three descriptions of one.
The exemption most often assumed and least often available is the single-family one. It is conditional on the owner having served a specific written notice on the tenant. Owners who never served it — which is common, particularly where the tenancy predates the Act or the property has changed hands — do not have the exemption in practice, whatever the property type suggests.
Common mistakes
Assuming a single-family rental is automatically exempt.
Instead: The exemption depends on ownership structure and on the required notice actually having been served. Check whether it was.
Believing a sale ends the tenancy.
Instead: It does not. The tenancy and its protections continue with the property, and the buyer inherits them.
Relying on the state rule where a local ordinance is stricter.
Instead: Check the city. The Act is a statewide floor, and a number of California cities sit well above it.
Questions people ask
Can I sell a house with tenants still in it?
Yes. The tenancy transfers with the property and the buyer takes it subject to the existing lease and to whatever protections apply. That is a normal transaction for buyers who want an occupied rental, and a complication for buyers who wanted to occupy or renovate — which is why occupied properties attract a different set of buyers and, usually, a different price.
Is a cash-for-keys agreement legal?
A negotiated buyout, where a tenant agrees to leave in exchange for payment, is a normal and lawful arrangement, and it is often better for both sides than a contested process. Some California cities regulate buyouts specifically — requiring disclosures, minimum terms or filing — so the local rules matter, and a written agreement is the point at which advice is worth taking.
Bottom line
AB 1482 sets a floor, cities frequently set a higher one, and the exemptions are narrower in practice than they look on paper. For a seller the operative question is not whether the property qualifies in theory but whether the required notice was actually served — and what the property is worth occupied versus vacant.
Official sources
- California Department of Real Estate — Tenant Protection Act guidance
State-level consumer guidance. Local rent stabilisation and just cause ordinances are administered by individual cities.
Written and maintained by Sierra Property Buyers, a direct property buyer working across Northern California. Last reviewed August 2026. This page is general information about how California property transactions work — it is not legal, tax, or financial advice, and the specifics of any situation should be confirmed with an attorney, a CPA, or the relevant agency.
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