Deadline looming for Oakland landlords to raise rents

Oakland’s formula for calculating the allowable annual rent increase is 60% of the Consumer Price Index (CPI), and as of the date of this writing, it is 2.3%. Beginning August 1st, 2025, however, the rent cap will be set at a whopping 0.8%.

Owners are admonished to issue any eligible rent increases on or before June 30, 2025.

Our office can assist in preparing a 30-day notice if housing providers are entitled to a rent increase. If there are any notices to increase rent after August 1st, 2025, we are stuck at 0.8%. Oakland landlords need to act swiftly to raise rents if they are entitled to do so.

We are not economists, but let’s think about this number for a moment. The CPI is a yardstick that measures the upward pressure on prices for certain consumer staples - a “market basket” of goods and services that consumers pay for.

Take, for example, eggs. Politicians have talked about the price of eggs and how they have gone down in price. But landlords are not grocers selling eggs; they are providing the essential service of housing. What is not adequately reflected in the CPI is the rising costs of operating a rental business. What are we talking about?

• Labor cost for contractors like plumbers, electricians, etc. Owners of aging buildings are especially feeling the brunt of rising maintenance and repair costs.

• Costs for building materials, HVAC parts, and appliances.

• Insurance premiums, if a housing provider can obtain coverage at all.

• Regulatory compliance costs like rent registries, seismic retrofitting, mandatory inspections, legal fees, etc.

• Rising costs for water, gas, and garbage that landlords often can’t pass through to tenants.

The list can go on, but the quintessential point is that an index tied to the fluctuating prices of consumer goods does not reflect the true cost pressures housing providers face.

Moreover, as of January 1, 2026, the banking of rent increases will be limited to five years versus the current ten-year expiration term, and we’ve seen firsthand that this has put a damper on purchases. Some would-be property owners do not want to purchase a tenant-occupied building if they are unable to bank rents.

Some parting thoughts

Having practiced landlord-tenant law for over three decades, we used to think that San Francisco and Berkeley were home to the most pernicious landlording regulations, but Oakland is arguably taking the title of the most hostile place for landlords to do business in.'

These abysmal rent increase amounts also underscore the value of a vacancy. Owners can typically raise rents to market rate when the tenant vacates. Perhaps there is a problematic tenant who can be transitioned out, or maybe a tenant is willing to engage in a discussion about a tenant buyout agreement whereby they leave voluntarily. Our offices may be able to effectuate a vacancy or not, but we are always here to be a sounding board on what options rental housing providers may have at their disposal.