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Explainer 

What is Proper Notice for a Rent Increase?

Mark Elliot

Beverly Hills agreed on the maximum allowable annual rent increase for rent-stabilized households just days before the new percentages took effect on July 1st. Landlords who waited to learn the maximum percentages available were unable to raise the rent as early as July and unless they were quick on the draw they could miss the minimum 30-day notice deadline for August 1st. Some cheated the advance notice and others didn’t post the notice properly. We thought an explainer was in order: What is proper notice for a rent increase?

The landlord of a Beverly Hills rent-stabilized tenant can raise the rent to the maximum percentage allowed under the rent stabilization ordinance. The vast majority of tenants are regulated by Chapter 6 of the ordinance which indexes the percentage increase to inflation. That data that is released by the Bureau of Labor Statistics in June. Each year the new new percentage takes effect on July 1st which leaves not enough time to properly notify a tenant for a July rent increase.

This year barely 33 days elapsed between the time the new percentage was known and the closing of the window to notify a tenant of an August rent increase. That opened the door to the landlord who would shave a few days off of the required notice period; or who might amend an issued notice to change the percentage demanded rather than correcting it and serving the notice anew as the law requires.

Read more about the rent increase in our explainers: Fundamental Concept: The Annual Rent Increase and The Annual Rent Increase: What You Need to Know.

This explainer focuses on two aspects of the required rent increase notice that every tenant should understand: the requirements of an effective notice and the proper service of a rent increase notice.

Effective Notice: the Basic Requirements

At the very least a rent increase notice must identify the tenant and landlord and clearly state the amount of the rent that is due after the rent increase. But the law is actually specific as to the contents of an effective notice and the landlord should not cut corners. The essential information:

  • Date of the notice
  • Names of known tenants
  • Property address including unit, street, city and county
  • Effective date of the rent increase
  • Amount of the new rent (and security deposit if applicable)
  • Name and signature of the landlord (or landlord’s agent)

We have seen notices evidently formatted for jurisdictions outside of Beverly Hills that will mention fees that are not applicable in Beverly Hills. For example Los Angeles allows the landlord to pass-though a rent stabilization administration fee and an inspection fee. If these fees appear on the notice then bring it to the attention of the landlord. The notice will have to be corrected and reissued with the clock on the required notice period started again.

The amount of the rent increase is always worthy of a tenant’s scrutiny specifically the landlord’s math. Mistakes can be made and it’s better to catch them sooner. In fact we have posted an explainer about how to do it: Is the Landlord’s Rent Increase Lawful? Trust But Verify!

Service of the Notice

State law requires that notice of the rent increase be properly served. In fact the state Civil Code is quite specific! And there are only two options for proper service of a rent increase notice: personal service and mail. From CIV § 827(b)(2):

In all leases of a residential dwelling, or of any interest therein, from week to week, month to month, or other period less than a month, the landlord may increase the rent provided in the lease or rental agreement, upon giving written notice to the tenant, as follows, by either of the following procedures: (A) By delivering a copy to the tenant personally. (B) By serving a copy by mail under the procedures prescribed in Section 1013 of the Code of Civil Procedure.

Personal service must occur no fewer than 30 days in advance of the effective date of rent increase. Moreover, personal service requires the landlord to make personal contact with the tenant when serving the notice. If the tenant chooses not to accept the notice, or refuses to open the door or whatever, then, and only then, may the landlord leave the notice at the door.

As for mailed service the landlord must provide five additional calendar days (35 days total) for mailed service from within the state. If service originates from outside of California then 10 days additional calendar days are added to the 30-day notice period (40 days total). Code of Civil Procedure § 1013:

Service is complete at the time of the deposit, but any period of notice and any right or duty to do any act or make any response within any period or on a date certain after service of the document, which time period or date is prescribed by statute or rule of court, shall be extended five calendar days, upon service by mail, if the place of address and the place of mailing is within the State of California, 10 calendar days if either the place of mailing or the place of address is outside the State of California but within the United States…

First-class mail is sufficient to meet the law’s requirement although delivery by alternate carrier is also acceptable. (In fact landlords are advised to use first-class mail because a tenant may not choose to accept delivery of certified mail but cannot refuse first-class mail.)

Again, these limited options for proper service means that the usual landlord practice of posting the notice of rent increase on the door, or slipping it under the door, is not satisfactory. The law does not recognize that as personal service. And informal noticing such as email, text, phone or carrier pigeon is out of the question.

What to Do with a Deficient or Ineffective Notice?

It is the responsibility of the tenant to call-out a deficient or improperly served notice. For example, if the notice fails to include the date of the notice, misidentifies the tenant or the address of the property or doesn’t identify the landlord, then then the notice is deficient. If the landlord has miscalculated the rent increase or demands a percentage increase in excess of what is allowed then the notice is deficient. The tenant should contact the landlord.

A deficient notice must be rescinded and reissued and that starts the clock again on the required notice period. That may buy some time on the rent increase but the fact is that the landlord can reissue the notice and demand the rent increase on any day of the month (more on that below).

If the tenant does not call-out a deficient notice, or one that was not served properly, then the law considers the tenant to have consented and the notice is considered sufficient and the service is proper.

Should a tenant always call-out a deficient notice or flag improper service? That is a judgment call. Take for example a notice properly served personally to the tenant 29 days before the date of rent increase. That is one day late. It may not be prudent to call it out because it generates bad will. Likewise the notice with a minor error in the tenant’s name may not be worth calling out.

The Rent May be Raised on Any Day of the Month

When a notice is deemed insufficient or improperly served the error must be corrected and the notice reissued. The landlord can reissue the notice for a rent increase on the earliest day after the requisite notice period even the rent increase will fall somewhere else in the month.

In other words the landlord need not wait until the first of the next month to take that delayed rent increase. The rent increase can take effect on any day. The dollar value of the rent increase would have to be prorated so that the landlord collects the additional rent only for days on and after the rent increase takes effect.

Prorating a Mid-Month Rent Increase

The amount of the rent increase must not exceed what is allowable by the city or else the notice is not sufficient and must be reissued. That does happen and the tenant may find herself checking the landlord’s math on a prorated rent increase. How would it be calculated? Glad you asked!

Say a mistake on the notice foils the landlord’s plan to raise the rent on November 1st. The landlord had to rescind the notice and issue a new one. But the landlord doesn’t want to wait until December 1st for his additional rent so the landlord issues a new notice for a rent increase that takes effect at the earliest possible date. In this hypothetical it is November 11th. How much rent should the tenant pay on November 1st?

Of course the notice will say how much is due but we want to encourage tenants to check the notice for accuracy. To prorate the rent increase we must split the month into two periods: one period at the current rent and the second period at the higher rent.

Let us add numbers to this hypothetical. The landlord demands a 3.3% rent increase on a monthly rent of $3,000. The rent increase takes effect on November 11th. The total rent due on November 1st, says the landlord’s notice, is $3,066.67. Is that correct?

First we calculate the daily rent for period one. At the current rent of $3,000 the daily rent for a 30-day month is $100 per day ($3,000 divided by 30). For the 10-day period between Nov. 1st and Nov. 10th the tenant will pay a daily rent of $100. The amount due on November 1st for period one is $1,000.

Next we calculate the daily rent for period two. At the higher rent of $3,100 per month the daily rent for a 30-day month is $103.33 ($3,100 divided by 30). For the 20-day period between Nov. 11th and Nov. 30th the tenant will pay a daily rent of $103.33. The amount due on November 1st for period two is $2,066.67.

We add together the rent for period one and the rent for period two and the total amount of rent due on November 1st is $3,066.67 ($1,000 + $2,066.67). The landlord’s math was correct.

Note: working with these figures is a reminder that the landlord cannot ‘round up’ to the nearest dollar when calculating the rent increase; it must be to-the-penny. Of course the landlord is always free to ‘round down’!

Additional Reading