Those in the real estate industry, and particularly those dealing with rental properties, will know that laws and guidelines change frequently to protect renters and landlords. These changes can be difficult to keep up with, and landlords who are not using a professional management company may struggle to stay up-to-date. Below we have detailed the newest ordinance to impact Oxnard, ordinance no. 3013, which is surrounding rent stabilization.
Landlords cannot increase rent by more than 4% each year. There cannot be more than one increase annually, unless exempt by the Costa-Hawkins Rental Housing Act.
Reasonable Rate of Return
If a property owner who is renting out their property believes that the limit on rental increases put in place by this ordinance will prevent the landlord from receiving a fair, reasonable return on their property, they are allowed to petition for relief from the 4% cap.
Tenants will have 30 days from the date of receipt of the petition to reply and provide additional materials to the city in response to the petition. The owner will bear the burden of establishing that a rate increase of more than 4% is necessary, by providing an independent financial research report and verified financial data. This documentation must demonstrate that without an increase greater than the allowed 4%, they will not be able to realize a reasonable return on the property.
The owner is responsible for all costs associated with the city’s review of this material. When the city receives the petition, the city will determine the projected costs of review and if it will be necessary to bring in experts to provide a thorough analysis of the owner’s petition and request. The owner will be notified of the cost, and the petition will not be processed until this is paid.
This ordinance does not necessarily apply to every landlord in every circumstance. Per the Costa-Hawkins Rental Housing Act, any residential property that has a certificate of occupancy issued after February 1, 1995 are exempt.
Due to the implementation of the Tenant Protection Act of 2019, the ordinance does not apply to the following:
- Low-income or affordable restricted housing;
- Dorms owned by an educational institution;
- Property that can be sold separately from other dwelling units, provided that the owner is not an REI trust, corporation, an LLC in which one or more members are a corporation, or the tenant is provided with proper written notice that the property is exempt from this ordinance.
- A duplex where the owner occupied on of the units and the beginning of the occupancy, and continues to occupy.
Owners who this ordinance applies to must give the tenant a written notice as outlined by the city, on or before the date of a new tenancy. The owner must include notice of the existence of this Chapter 27, Article II of the City Code, and the tenants right to respond to any Fair Return Petition filed with the city. No rent increase should go into effect until all of the requirements have been met.
If you have questions regarding this or any other ordinance or law, we recommend seeking professional help. Laws regarding rental properties change frequently, and can be difficult to understand and therefore, to abide by properly. If you have questions about the impact of this ordinance on your property, you can contact us, here!