Owning rental property in California can be both rewarding and challenging. Providing a home for someone who can’t yet purchase their own can be deeply satisfying. But the same laws that protect tenants also create a complex landscape for landlords, especially in areas like San Diego County, where regulations evolve constantly.
If you’re a landlord, you already know how important it is to stay compliant. The challenge lies in understanding not just the state laws, but also the overlapping city and county ordinances that can apply to your property. Let’s walk through some of the most important updates for 2025.
Understanding California Rent Control
One of the biggest areas of confusion for landlords today is rent control. In California, rent control applies to most properties with two or more units and to those owned under a corporate structure rather than an individual or family LLC. If, for example, a property is owned under a corporate name rather than “Danielle Brooks LLC,” it’s generally considered rent controlled.
There are exceptions. If you live in one unit of a duplex or in the main house while renting out an accessory dwelling unit (ADU), your property is usually exempt.
For rent-controlled properties, rent increases are limited to 5% plus the Consumer Price Index (CPI). In San Diego, that means a current cap of 8.8%, though the CPI fluctuates each year. Even if your tenant’s rent is well below market value, you can’t exceed that cap.
It’s also worth noting that utilities billed through ratio utility billing (RUBS) are included in the rent control calculation. If you’re charging tenants a share of the water or sewer bill, that amount counts toward the total rent increase allowed.
Every lease should include a clear statement on whether the property falls under rent control, and it must be updated to match the 2025 legal language. This clause also appears in move-out notices and other resident communication to ensure compliance.
City-Level Tenant Protection Ordinances
California’s landlord-tenant laws already set strong protections for residents, but individual cities have added even more detailed rules. Cities such as San Diego, Chula Vista, and Imperial Beach each have their own tenant protection ordinances, which work alongside state law to define how landlords can handle evictions, rent increases, and lease terminations.
Even at the end of a fixed lease term, you can’t simply ask a tenant to leave without just cause. Acceptable reasons vary by city and often include selling the property, moving in yourself or a close family member, or conducting major repairs. In San Diego, “substantial repairs” usually refers to permitted projects that cost around $50,000 or more.
If a landlord reclaims a rent-controlled property for personal use, the law requires payment of two months of relocation expenses to the tenant. These rules may feel strict, but they’re a central part of California landlord-tenant law, which prioritizes tenant stability across the state.
Security Deposits and Move-Out Compliance
Security deposits continue to be one of the most common pain points for landlords, and recent legal updates make record keeping more crucial than ever. Once a tenant vacates, you have 21 days to return the deposit or provide an itemized statement of deductions. Missing that deadline can result in owing double the deposit amount, regardless of the tenant’s remaining balance or damages.
To make valid deductions, landlords must include:
Move-in and move-out photos
Receipts or invoices for any repairs or cleaning
Proof that deductions exclude normal wear and tear
If you charged $300 for cleaning at move-in, you can’t automatically bill that full amount years later. The cost must be prorated based on reasonable use. These detailed records are not just good practice, they’re now essential under California security deposit law.
Screening Applicants Fairly
New screening rules have made the application process more structured. If several tenants apply for the same unit, you can’t keep application fees for the applicants who weren’t selected. Each unapproved applicant must receive a full refund, along with a copy of their credit report if it was used in screening.
To stay compliant, landlords should establish a written set of screening criteria before reviewing applications. Applying the same standards to every applicant helps maintain fairness and avoids potential disputes down the line.
When Property Management Becomes Worth It
Managing a rental in California means more than collecting rent, it’s about interpreting a patchwork of ever-changing regulations. For many landlords, hiring a professional management company becomes less of an expense and more of a safeguard.
Property management professionals track evolving rent control limits, guide landlords through California’s eviction process, and ensure that city-specific tenant protections are followed correctly. They also handle day-to-day responsibilities like documentation, notices, and accounting, all of which can reduce the risk of costly legal missteps. Understanding how property management fees fees are structured can help you decide whether outsourcing these responsibilities fits your investment goals.
Final Thoughts
Being a landlord in California offers tremendous potential, but it also demands constant attention to legal detail. Rent control caps, just-cause requirements, and documentation rules can shift from one year or one city to the next. Treating your rental property as a business, with systems in place for compliance, helps ensure your investment remains an asset rather than a liability.
Staying informed and organized can make all the difference. More insights and guidance on California property ownership can be found at Beyond Property Management.