Daily-rate disaster rentals would face a tighter California cap

In California, renters forced out by a fire, flood or other declared emergency could face fewer price shocks when they look for a place to stay. SB 1365 would widen the state’s emergency rent-gouging rules so they cover any rental housing, instead of only housing with an initial lease term of one year or less.

That matters most when shelter is scarce and time is short. For evacuees and displaced tenants, the bill would make it harder for landlords to sidestep the cap simply because a unit does not fit the old definition. It also preserves a narrow defense for owners who can show a higher rent is directly tied to repair or addition costs caused by the emergency itself.

Where the cap reaches

The bill is an amendment to California’s existing emergency price-gouging law, not a replacement for it. It would broaden the definition of covered housing to include all rental housing, which also captures places such as mobilehome parks and campgrounds when they are used as rental housing.

SB 1365 would also spell out when a landlord can defend a higher rent. If repair or addition costs were caused by the emergency event, a rent increase above the cap could still be justified. In some cases, older repair or addition costs could count too, but only if the unit was already rented, advertised or offered for rent, or if the owner can show the property was intended to be rented within six months after the work was done.

Recorded votes show the bill cleared a floor vote.

The daily-rate rule

The bill draws a separate line for short-term emergency rentals. If housing is newly advertised, offered or charged at a daily rate after an emergency, and it was not marketed that way in the year before the declaration, the rental price would be set at one-thirtieth of the existing U.S. Department of Housing and Urban Development, or HUD, benchmark amount.

That formula gives the state a ready-made ceiling for the most volatile part of the disaster market. It also narrows the room for last-minute premium pricing when people are looking for a bed, a roof and almost anything that keeps them out of a car or shelter line.