max increase

The maximum allowable annual rent Increase for Chapter 6 Beverly Hills rent-stabilized tenants has been posted: through June of 2025 the rent may be increased by 3.9% with proper notice. That figure reflects the May-to-May percentage change in the federal Consumer Price Index (CPI) for our region. (The maximum allowable increase for the relatively few Chapter 5 households, i.e. old rent control, for June is 3.2%.) The rent increases did not require city council approval because the percentages were again indexed to inflation after pandemic-era measures came to an end in May 2023.

City Council has approved the highest annual rent increase for Chapter 5 rent-stabilized tenants in decades. At 5.9% this year’s increase is nearly twice the rate of inflation for our region. It falls hardest on long-term rent control households that are headed almost exclusively by seniors who live on a fixed-income. Meanwhile Chapter 6 tenants get a relative break with a 3.2% rent increase. Yet there is no sign on the horizon of the often-mentioned rent subsidy which was left for dead by a City Council committee a full year ago. What are our councilmembers thinking?

Bureau of Labor Statistics data shows that inflation has moderated: the annual change in the cost of goods and services in our region is 3.2% which is down from a high of 8.5% last summer. That is good news for Beverly Hills rent-stabilized tenants because the maximum allowable annual rent increase is ordinarily pegged to inflation. But this is no ordinary year and City Council will contemplate a rent increase that is greater than the rate of inflation when it meets on June 27th. The key question: will moderating inflation mean a moderate allowed annual rent increase?

The Beverly Hills Rent Stabilization Commission at the July meeting discussed what should be the maximum allowable annual rent increase and agreed to recommend that it be capped at 8% for all rent-stabilized households — which is the percentage cap in place today for longtime Chapter 5 tenants. Reporting on the commission’s recommendation has generated some confusion over what it might mean in terms of rent hikes for coming years. Let’s talk about the cap and more generally about indexing the rent increase to inflation and put it all into the context of the recent City Council decision to allow a 3.1% increase this year.