AB 1482: California’s Rent Cap Rules for 2025 (Part 1 of 2)

California’s Tenant Protection Act (AB 1482) has two major parts:

1. Rent Increase Limits

2. “Just Cause” Eviction Rules

To make things easier, we’re splitting this into two separate guides.

• This post (Part 1) covers the rent increase limits under AB 1482, including how the 2025 cap is calculated and applied.

• Our companion post (Part 2) will explain the “just cause” eviction rules, when they apply, and what landlords must do to stay compliant. → Read Part 2: AB 1482 Just Cause Rules Evictions and No-Fault Terminations

👉 Rent increases are the #1 way small landlords accidentally violate AB 1482, so let’s start there.

1. 2025 Rent Cap for Santa Barbara

For rent increases effective August 1, 2025 – July 31, 2026, Santa Barbara landlords must use the West Coast CPI, since the city does not publish its own CPI index.

• West Coast CPI (April 2025): 2.7%

• 5% + 2.7% = 7.7% maximum allowable increase

📌 Source: California DIR CPI Report

👉 The 2.7% CPI published in April 2025 controls rent caps for August 2025 through July 2026.
👉 The next CPI update (April 2026) will set the cap for August 2026 – July 2027.

2. How Rent Caps Are Calculated

The AB 1482 cap doesn’t follow the calendar year. Instead:

1. Every April, the California Department of Industrial Relations publishes updated CPI figures.

2. That CPI is added to the flat 5% base.

3. The new rent cap takes effect on August 1 and lasts until July 31 of the following year.

3. Example: Applying the 2025 Increase

Tenant pays $2,000/month:

• 2025 cap = 7.7%

• $2,000 × 7.7% = $154

• New rent = $2,154/month

⚠️ Rules to remember:

• Only one increase every 12 months is allowed.

• Landlords must give proper written notice (30 or 90 days depending on the increase size and lease type).

4. Exemptions to AB 1482

Some properties are not covered, but exemptions are narrow and must be properly documented:

• New construction (less than 15 years old).

• Single-family homes and condos, if owned by an individual (not a corporation, REIT, or LLC with a corporate member) and if tenants are given the required exemption notice.

• Certain deed-restricted affordable housing units.

⚠️ Important: Even if your property qualifies for an exemption, you must give the tenant written notice of that exemption.
If you do not provide the notice, the property is treated as covered — meaning just-cause rules apply.

• Short-term rentals over 30 days: Once a rental exceeds 30 consecutive days, it is no longer treated as a transient occupancy. If there’s no exemption, AB 1482 rules apply.

• Leaseback after a sale: If a seller stays in the home after closing under a leaseback agreement, that leaseback can fall under AB 1482 unless the property qualifies for an exemption and the notice is properly given.

📌 Bottom line: If you think your property is exempt but don’t have it documented in writing, assume the law applies.

5. Mission City’s Approach

We simplify AB 1482 compliance by:

• Applying the 7.7% cap for 2025 (Aug 1, 2025 – Jul 31, 2026).

• Tracking lease anniversaries to ensure only one increase per year.

• Confirming exemption notices are always provided when applicable.

• Recommending increases a couple of points below the maximum cap (e.g., 5–6% instead of 7.7%) to reduce risk of miscalculation and ensure full compliance.

This proactive approach also protects tenants from surprise increases, helping us build trust while protecting landlords from costly mistakes.

✅ Key Takeaways