The Rules Changed While You Were Collecting Rent:

Written By 1031 Capital Solutions

Two Years of Landlord Regulation Across the West

If you own rental housing in California, Oregon, Washington or Colorado, the last twenty-four months rewrote more of your operating manual than the prior decade did — not as one big law, but as a rent cap here, a fee ban there, a registration requirement, a longer notice period. They point one direction: less discretion over what you charge, and more process before you can act.

Washington enacted a statewide rent cap

HB 1217, signed May 7, 2025 and effective immediately, caps annual increases at the lesser of 7% plus CPI or 10%, bars any increase in the first twelve months of a tenancy, and holds manufactured and mobile home lots to a flat 5% with no expiration. Commerce publishes the figure each June — 9.683% for 2026. Rent-increase notice went from 60 to 90 days. New construction is exempt for twelve years, along with owner-occupied two- to four-unit buildings, LIHTC properties and nonprofit affordable housing.

What separates this from a symbolic law is enforcement. The Attorney General enforces it under the Consumer Protection Act, tenants have a private right of action, and penalties reach $7,500 per violation. In year one, AG Nick Brown's office resolved roughly fifty cases and imposed more than $800,000 in fines — nearly all suspended in exchange for compliance, and most of the largest against manufactured-home and RV park operators. A constitutional challenge to the 5% cap, argued in Spokane County Superior Court in July 2026, was undecided as of this writing.

Seattle went further on fees: on August 11, 2026 the council banned pet rent, package and mail handling charges and common area maintenance fees and required fee disclosure in advertising, effective July 1, 2027.

Oregon's cap keeps drifting down

Oregon has capped rents since 2019 under SB 608. The formula produced 10.0% for 2025 and 9.5% for 2026. The bigger 2025 change was HB 3054, cutting the cap to 6% for manufactured home parks and marinas with more than thirty spaces and limiting vacancy re-pricing to 10% above the prior tenant's rent.

Efforts to tighten the general cap failed: SB 722, which would have cut the new-construction exemption from fifteen years to seven and banned algorithmic rent-setting, died in committee. Two 2026 laws matter operationally — SB 1523 requires non-portal payment options on request, and HB 4123 bars disclosure of a tenant's immigration status or medical records. Locally, Eugene's $10 screening fee cap survived preemption challenge, and Portland banned rent-setting algorithms.

California legislated procedure, not price

California's headline rent-control pushes failed. Proposition 33 lost 60%–40% in November 2024, the third straight defeat for Costa-Hawkins repeal, and AB 1157 — which would have cut the AB 1482 cap from 5%+CPI to 2%+CPI and deleted the 2030 sunset — died in Assembly Judiciary in January 2026.

What passed instead reshaped daily operations. AB 12 capped deposits at one month's rent, with a narrow carve-out for owners of two or fewer properties totaling four or fewer units. AB 2493 ties application fees to actual cost and requires processing in order received. AB 2801 mandates photo documentation for deposit deductions, SB 611 bans fees for paying by check and for serving notices, and AB 2347 doubled a tenant's response window on an unlawful detainer to ten business days. AB 325, effective January 1, 2026, bars common pricing algorithms built on competitor data.

The most consequential California action was local. Los Angeles overhauled its Rent Stabilization Ordinance for the first time in roughly forty years — Mayor Bass signed it December 23, 2025, replacing the old 3%–8% band with 90% of CPI, floored at 1% and capped at 4%. Registration regimes are spreading with real teeth: Santa Monica's non-RSO registry carries a $200-per-unit monthly penalty and, from January 1, 2027, bars unregistered owners from collecting rent at all.

Colorado rebuilt the fee structure

HB25-1090, effective January 1, 2026, requires all mandatory charges to be folded into a single advertised base rent — CAM charges, property-tax pass-throughs and payment processing fees can no longer be separate line items. Enforcement runs through the state Consumer Protection Act, with 18% annual interest on fees not refunded within fourteen days of demand.

That sits atop HB24-1098, the 2024 just-cause law requiring a statutory ground to evict or decline renewal plus 90 days' notice, and HB25-1249, which shifts the burden of proving damages onto the landlord in deposit disputes.

Nevada and Arizona: the wall held

Nevada's legislature passed a slate of tenant bills in 2025; Gov. Joe Lombardo vetoed most, including a 5% rent cap for tenants over 62, summary eviction reform and an algorithmic pricing ban. The survivor was AB 121, effective October 1, 2025, which requires rent to be advertised and leased as one all-in figure and mandates a fee-free payment method.

Arizona remains the outlier: A.R.S. § 33-1329 preempts local rent control, repeal attempts went nowhere, and the 2026 session produced no new tenant protections. Pressure came from the Attorney General instead, whose 2024 price-fixing suit against RealPage and nine landlords produced a $1 million settlement with Weidner Property Management in February 2026.

The small-city layer

Beneath the marquee ordinances sits a dense layer of smaller Southern California municipal rules that reshaped operations for owners who don't track city council agendas closely. In 2024, Huntington Park adopted rent control and a rental registry on November 18 (effective December 17), capping increases at the lower of CPI or 3%, reaching duplexes and single-family homes with ADUs, and requiring registration within 60 days; Burbank raised relocation fees to three times monthly rent for all no-fault evictions effective August 30; South Pasadena banned "renovictions" on November 15, eliminating substantial remodel as grounds for eviction and requiring temporary relocation instead; West Hollywood raised the minimum lease term for single-family and condo rentals from 31 days to a full year on March 18; and Oxnard began requiring owners claiming owner-move-in to occupy the unit for 24 months and file a sworn affidavit as of July 30. The pace accelerated in 2025.

Oxnard added rental registry and just-cause enforcement fees of $138.77 and $69.39 per unit effective June 19, then a tenant anti-harassment ordinance effective August 14 carrying $10,000 per violation or actual damages, punitive damages, up to six months in jail, and an additional $5,000 per violation involving senior or disabled tenants. Burbank passed its own anti-harassment ordinance in March, adopted a 4% soft cap on rent increases for pre-1995 properties on October 28, and mandated soft-story seismic retrofits on December 10 with a five-year deadline and pass-throughs capped at $51 per unit per month for 120 months. Claremont's anti-harassment ordinance, effective June 26, reaches single-family homes, condos and ADUs and bars immigration-status threats. Cudahy barred eviction unless unpaid rent exceeds HUD Fair Market Rent (October 7). Pomona made rent stabilization permanent on November 17, moving to a fixed 5% annual increase not indexed to CPI. Beverly Hills imposed a one-year minimum initial lease across essentially all rental types on July 15.

The compliance layer keeps thickening too: Port Hueneme extended its smoking and vaping ban to all multifamily units and common areas, Glendale will require heat-pump-grade efficiency when air conditioning is installed or replaced in duplexes, townhomes and single-family rentals beginning December 2026, and West Hollywood's building performance standards for properties over 20,000 square feet carry penalties of up to $10 per square foot. Culver City is weighing the most aggressive package of all — folding all fees into the annual rent cap, eliminating the 50% registry fee pass-through, and barring LLC and LLP owners from claiming owner-occupancy — though as of this writing it remains proposed rather than adopted.

Two trends that cross every border

Algorithmic rent-setting is being dismantled by enforcement more than legislation. Statewide bans failed in Oregon and Washington and were vetoed in Colorado and Nevada; city bans passed in San Francisco, San Diego, Seattle and Portland. Meanwhile DOJ settled with RealPage in November 2025, private landlord settlements reached $141.8 million, and state AGs settled with Greystar, LivCor and others. Berkeley suspended its own ordinance rather than defend it against RealPage's First Amendment challenge — these bans are not settled law.

Congress acted on ownership. The 21st Century ROAD to Housing Act became law July 11, 2026 without the President's signature. From January 7, 2027, entities with investment control of 350 or more single-family homes may not buy more, with exceptions for new construction, build-to-rent and homeownership programs. Penalties run to $1 million per violation or three times the purchase price; existing holdings are grandfathered.

What it means operationally

Ancillary fee income is the most exposed line on your P&L; Colorado, Nevada and Seattle attacked it from different angles, and the FTC opened a rental-housing fee rulemaking in March 2026. In Washington, Oregon and much of California, your rent trajectory is now a formula published by a state agency rather than a market judgment. And the friction cost of a vacancy or an eviction has risen nearly everywhere.

None of this news makes rental housing a bad business, but location is an increasingly critical factor. 

This information is for educational purposes only and does not constitute direct investment advice or a direct offer to buy or sell an investment, and is not to be interpreted as tax or legal advice.

Securities offered through Concorde Investment Services, LLC (CIS), member FINRA/SIPC. Advisory services offered through Concorde Asset Management, LLC (CAM), an SEC registered investment adviser. Insurance products offered through Concorde Insurance Agency, Inc. (CIA). 1031 Capital Solutions is independent of CIS, CAM and CIA.

 

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