NEWPORT BEACH, California - Many landlords providing new low-income housing in California won’t be able to increase the rent on their tenants by more than 10% per year, under a rule imposed this week by a state committee.
The cap, passed Wednesday by the California Tax Credit Allocation Committee, affects all future developments built with the help of Low Income Housing Tax Credits. California awards the federal and state credits to build about 20,000 new units a year; the program is the primary government funding source for private developers to build affordable housing.
The rule is similar to a 2019 state law for other tenants — restricting annual increases to either 5% plus inflation, or 10%, whichever is lower.