San Francisco wants to put a ceiling on one of the biggest rent hikes some longtime tenants can face, but tenant advocates say the proposed limit may still leave renters vulnerable to displacement.
State of play: Supervisor Danny Sauter recently proposed legislation that would cap annual increases from “banked” rent and certain capital improvement costs at 10% annually for rent-controlled tenants through 2029.
- The proposal, developed with Mayor Daniel Lurie as part of his broader effort to address the city’s “rent emergency,” would apply to banked increases issued on or after Sept. 15.
- It wouldn’t change the regular annual allowable rent increase, which currently stands at 1.6%.
How it works: Landlords of rent-controlled units are allowed to raise rents by a small percentage each year. If they skip an annual increase, they can save it and add that unused amount to a future increase.
- Those increases can accumulate for years. Under current rules, there’s no overall cap on how much banked rent can be imposed at once.
Sauter told Axios some owners may impose banked rent increases because they hadn’t raised rents every year or held off during softer rental markets to retain tenants.
- Tenant advocates told Axios they’ve also seen such increases imposed when buildings change ownership or after tenants ask for repairs.
Yes, but: A 10% cap doesn’t erase accumulated increases. It limits how quickly they can hit.
Tenant attorney Allyson Murphy of Tobener Ravenscroft said that would soften the immediate blow, but questioned whether 10% itself is affordable.
- “Most people I know I don’t think can afford a 10% rent increase,” Murphy told Axios, particularly noting the burden on tenants with fixed incomes.
- She called the proposal “the right start,” but said it may need to be strengthened.
Zoom in: Aleida García Aguirre, a counselor with the Housing Rights Committee of San Francisco, told Axios the proposal doesn’t address the underlying problem because landlords could continue applying accumulated increases over several years.
- García Aguirre is working with a senior couple facing a 65.8% banked increase after living in their apartment since 1990.
- Under the proposal, she said, “it doesn’t mean that their rent is not going to go up. It’s that it’s going to take more time to be as expensive as it can be.”
- García Aguirre wants the city to consider allowing tenants facing financial hardship to seek an exemption, similar to protections available for certain capital improvement passthroughs.
The other side: Sauter acknowledged that 10% is still significant but said the figure seeks to balance tenant safeguards with property owners’ ability to invest in and maintain their buildings…