Let’s start with the obvious:
This is still a proposal — it hasn’t officially passed yet.
But with the City Council’s new makeup, and everything they’ve already done this year, this feels like a sure thing.
(And honestly, I really hope I’m wrong.)
Let’s Recap 2025 So Far
This year’s been a whirlwind for rental laws:
April – The City of Santa Barbara passed new rental regulations.
Throughout the year – California added several new state-level housing laws for processing tenant applications and photo documentation for security deposits.
September – The City of Goleta passed its own rent stabilization rules
Now October – Santa Barbara is back with another round of rent control proposals
That’s four major changes in just a few months.
If you’re self-managing, it’s basically impossible and riskier to stay compliant.
The Proposal: Limit Rent Increases to 60% of CPI
Let’s break down the biggest change.
Under California state law (AB 1482), landlords can raise rent by:
5% + CPI (inflation)
Or up to 10% total, whichever is lower
This year, CPI is 2.7%, so the state allows up to a 7.7% increase.
But the City of Santa Barbara wants to cap rent increases at:
60% of CPI — with no added 5%
60% of 2.7% CPI = just a 1.6% rent increase allowed.
Compare that to the 7.7% allowed under state law — it's a major difference.
A 1.6% increase doesn’t come close to covering rising costs like insurance, labor, or materials — let alone inflation.
Other Big Concerns in the Proposal
The rent cap isn’t the only thing landlords should worry about:
Retroactive Rollback
The city may try to apply these limits to past rent increases. That means you could be in violation even if you followed the law at the time.New Rent Board
A 5-person board would be formed — but only 2 members can be landlords or property managers. That means the people deciding what’s “fair” might have little or no experience owning or operating rentals.Triple Damages for Mistakes
If you get the numbers wrong — even by accident — you could owe the tenant three times the difference. That kind of risk makes rent adjustments scary, even when justified.
It is Feeling Like a “Gotcha” System
Most landlords we work with are community-minded and try to do things right.
But with new rules coming every few months — and penalties getting harsher — it’s starting to feel like the system is stacked against small owners.
We’re hearing it more and more:
“It feels like I’m going to get in trouble no matter what.”
The Math Just Doesn’t Pencil Out
Let’s be real:
A rental property is an investment. You put time, money, and risk into it — and you should be able to get a fair return.
But:
If rent increases don’t keep up with inflation...
If costs are going up but your revenue isn’t...
And if one honest mistake could cost you triple damages...
That’s not a sustainable business.
That’s a trap.
What Happens If Small Landlords Sell?
Here’s what usually happens:
Small, local owners give up
Institutional, out-of-town companies buy up those rentals
And tenants lose the kind of responsive, people-first management they once had
Ironically, these new laws — meant to protect renters — might be pushing out the very owners who treat tenants like neighbors, not numbers.
What You Can Do
If you’re still managing on your own, it’s time to seriously ask:
“Do I want to keep doing this alone?”
At Mission City Property Management, we stay on top of:
State and local law changes
CPI and rent increase tracking
Compliance deadlines and forms
Owner protections and tenant communication
So you don’t have to.
Even if you’re not ready to hire a manager, we’re happy to talk and help you make sense of what’s changing.
