The anti-gouging protections for rental housing has been extended until July 1, 2025. On March 7, 2025, Governor Gavin Newsom issued an Executive Order extending California’s anti-gouging protections for victims of the L.A. fires. Those protections were previously scheduled to expire on March 8, 2025.

Here’s a quick summary of the current anti-gouging protections, but refer to the law itself for additional details: 

General Rule: The law looks at the rental price as of January 7, 2025, which was the day that the Governor declared a State of Emergency due to the L.A. fires. There are generally 3 sets of requirements (but see Exemptions further below):

1. Previously Rented or Offered for Rent: If a property was rented within the year preceding January 7, 2025, the landlord can generally charge 10% more than the most recent rental price before January 7, 2025. The amount may be increased by another 5% if previously unfurnished, but now fully furnished.

2. Not Previously Rented Within Preceding Year (Most Zip Codes): For a property not rented (or offered for rent) within the year preceding January 7, 2025, a landlord can generally charge 10% more than 160% of the fair market rent established by the U.S. Department of Housing and Urban Development (HUD), available here. The amount may be increased by another 5% if fully furnished. Many governmental and news sources fail to mention the 10%, so landlords may, as a matter of precaution, want to limit themselves accordingly.

3. Rented But Then Vacated: If a property was rented on January 7, 2025, but then vacated, the landlord can generally charge 10% more than: (1) the rent paid by the previous tenant; or (2) 160% of HUD’s fair market rent; whichever is greater.

Exemption for Certain Higher-Priced Rentals: A landlord is exempt from the anti-gouging protections if all 4 of the following conditions are met:

1. Not Previously Rented: The property is a single-family home that has not been rented or offered for rent within one year before January 7, 2025;

2. Certain Zip Codes: The home is located in one of the following zip codes: 90015, 90049, 90067, 90077, 90094, 90210, 90263, 90265, 90266, 90272, 90274, 90275, 90290, 90291, 90292, 90703, 91011, 91105, 91210, 91301, 91302, 91307, 91354, 91364, 91436, 91709, or 91789;

3. 4+ Bedrooms: The home has 4 or more bedrooms; AND

4. HUD Valuation: HUD’s 2025 fair market rent for a 4-bedroom unit in that zip code is $5,500 or more.

New Exemption for New Construction: As of March 7, 2025, any housing with a certificate of occupancy issued after January 1, 2025 is now exempt from the anti-gouging protections.

Other Possible Exemptions: Other possible exemptions include a landlord’s ability to charge more for verifiable costs of repairs or additions amortized over the rental term, but not for utilities or services, like gardening. As of February 4, 2025, there is no longer an exemption for leases of more than one year.

Non-Compliance: Price gouging is a crime, punishable by one-year imprisonment, plus a $10,000 fine.

Sources: Governor Newsom’s 3/7/25 Executive Order N-23-25 is available here. California’s price gouging law is set forth at section 396 of the California Penal Code, available at the California Legislative Information website. The California Department of Justice’s Price Gouging FAQs are available here.

-Thank you to Nick Cacarnakis (Beverly Hills Manager) for suggesting this week’s legal tip!

Copyright© 2025 Shared Success Center, LLC (serving HomeServices of America companies). All rights reserved. Any unauthorized reproduction or use of this material is strictly prohibited. This information is believed to be accurate as of March 10, 2025. It is not intended as a substitute for legal advice in individual situations, and is not intended to nor does it create a standard of care for real estate professionals. Written by Stella Ling, Esq.