San Jose Rent Control for Investors: ARO, TPO, Ellis Act and Registry
San José rent control applies to rental units in buildings with three or more units that were built and occupied before September 7, 1979. Under the city’s Apartment Rent Ordinance (ARO), rent on those units can rise by no more than 5% once in any 12-month period. Separately, the Tenant Protection Ordinance (TPO) requires a just cause to end tenancies in the city’s apartment buildings, newer ones included. Single-family homes, duplexes and condos fall outside the ARO, but state law can still cap their rents.
For an investor, the question isn’t just “is it rent controlled?” It is which of four layers apply to each unit: the ARO, the TPO, the city’s Ellis Act Ordinance and Rent Registry, or the state’s Tenant Protection Act. This guide walks through each one as of October 2026, shows how the rules change the numbers on a purchase, and ends with a checklist for escrow. It covers only the City of San José; other Santa Clara County cities and the unincorporated county have their own rules.
This page explains San José’s rent rules in general terms and is not legal advice. Before you rely on a rent roll, serve a notice or plan an Ellis withdrawal or owner move-in, have a California landlord-tenant attorney review your building.
Which buildings the Apartment Rent Ordinance covers
The ordinance is in San José Municipal Code chapter 17.23. Section 17.23.167 defines a “Rent Stabilized Unit” as a rental unit in a guesthouse or a multiple dwelling building that received its certificate of occupancy on or before September 7, 1979, or that was offered for rent by that date. The same section excludes units in buildings containing only one or two dwelling units, legally restricted affordable units and short-stay hotel rooms.
The city’s rent stabilization page puts the result plainly: apartments in buildings of three or more units “built and occupied prior to September 7, 1979,” about 38,000 apartments in all. It lists the main exemptions:
- Single-family homes, duplexes, condominiums and townhomes
- In-law units, granny flats and accessory dwelling units
- Units first rented after September 7, 1979
- Government-owned units, school dormitories and nonprofit homes for the aged
- Hotels and boarding houses rented to guests for less than 30 days
- Properties in unincorporated areas of San José, which are county land rather than city
Mobilehome parks have been under a separate city ordinance since 1985. The city’s Rent Stabilization Program will confirm whether a specific property is rent stabilized, and that call is worth making before you write an offer.
Rent increases under the ARO
Section 17.23.310 limits the annual general increase to 5% of the prior 12 months’ monthly rent, with no more than one increase in any 12-month period, after notice under Civil Code section 827. Larger increases need a petition and an administrative decision. A landlord who has not substantially complied with the city’s registration request may not raise the rent at all.
When a tenant moves out voluntarily or is evicted for cause, section 17.23.300 lets the landlord set the next tenant’s starting rent. That vacancy reset does not apply after a no-cause termination; then the prior rent plus authorized increases carries over. This tracks the state Costa-Hawkins Rental Housing Act (Civil Code 1954.52), which preserves an owner’s right to set initial rents in many cases.
Capital improvements can be passed through only after a petition is approved. Under sections 17.23.320 and 17.23.330, the work must have been finished within 12 months before the petition, ordinary like-for-like replacements generally don’t qualify, and total monthly pass-throughs can’t exceed 3% of the monthly rent. Part 8 of the chapter adds a fair return petition for owners who can show the 5% limit denies a fair return.
What the 5% cap means on a purchase
A hypothetical comparison for one unit renting at $2,400 a month:
| Building | Rule that applies | Maximum next increase | New monthly rent |
|---|---|---|---|
| Eight units, built 1968 | ARO, 5% once in 12 months | $120 | $2,520 |
| Eight units, built 1988 | State cap, 8.6% for Santa Clara County (Aug 1, 2026 to July 31, 2027) | $206.40 | $2,606.40 |
| Eight units, certificate of occupancy within the last 15 years | No state or ARO cap; TPO just cause still applies | Set by the lease and market | Market |
The figures are illustrations, not projections. The point is that below-market rents in a pre-1979 building close the gap slowly, mostly through voluntary turnover. Build that into your rental property analysis instead of assuming market rents in year one.
The Tenant Protection Ordinance: just cause in newer buildings too
Part 12 of chapter 17.23 applies to rent stabilized units, rental units in any multiple dwelling other than permitted hotels and motels, guest rooms in guesthouses, and unpermitted units. A November 2023 city memo describes the TPO-only group as buildings with “three or more rental units built after September 7, 1979,” and the city’s 2024-2027 strategic plan says the ARO and TPO together reach about 97% of San José’s multifamily units.
Section 17.23.1250 lists 13 just causes:
- Nonpayment of rent
- Material or habitual violation of the tenancy
- Substantial damage to the rental unit
- Refusal to agree to a like or new rental agreement
- Nuisance behavior
- Refusing access to the unit
- Unapproved holdover subtenant
- Substantial rehabilitation of the unit
- Ellis Act removal
- Owner move-in
- Order to vacate
- Vacation of an unpermitted unit
- Criminal activity
Owner move-in and substantial rehabilitation require relocation assistance equal to the Ellis Act “base assistance” set by City Council resolution. An owner or qualifying relative must move in within three months and live there for 36 consecutive months. For a relative, the unit must be in the same building as the owner’s principal residence, and no other unit there may be vacant.
Within three days of serving a termination notice, the landlord must send a copy to the city, and the same goes for any unlawful detainer summons and complaint (section 17.23.1260). Breaking these rules gives the tenant a defense to eviction and can lead to damages, treble damages for willful violations, and misdemeanor penalties. Our just cause guide for landlords covers the statewide version for comparison.
The Ellis Act Ordinance and what it leaves on title
The state Ellis Act lets an owner leave the rental business, and San José’s Part 11 sets the local procedure for rent stabilized units. The owner pays a city fee and serves notice at least 120 days before withdrawal, and sends a copy to the city within 10 days. Base relocation assistance goes into escrow when the notice is delivered. Tenants who are 62 or older, disabled, or terminally or catastrophically ill, and who have lived in the unit at least a year, can extend to one year. Households with school-age children can stay through the school year plus 60 days.
Two rules matter most to a later buyer:
- Recorded memorandum. Section 17.23.1145 requires a city-approved memorandum recorded with Santa Clara County that encumbers the property for 10 years from the withdrawal date. It must be recorded within 10 days after the notice goes to the city, or at least one day before any sale if that comes first. Look for it on the preliminary title report.
- Re-control. If withdrawn units return to the rental market within five years, they must be offered at the lawful rent in effect when the notice was filed, plus any authorized annual increases. If the site is demolished and rebuilt within five years, section 17.23.1180 makes new units rent stabilized: the number of withdrawn covered units or 50% of the new rental units, whichever is greater. Projects of 20 or more new rental units can obtain a waiver by providing 15% on-site affordable units plus another 5% restricted at 100% of area median income, among other conditions.
For a redevelopment buyer, an Ellis history can shape what gets built. Buildings of three or more units with no covered units can be withdrawn without recording a memorandum.
The Rent Registry and annual program fees
Section 17.23.900 requires the landlord to register each rent stabilized unit with the city every year, reporting the rent the tenant actually pays. Registration more than 30 days late carries a late fee. The city’s welcome packet for new owners says occupancy information must be updated annually through a registry login the city issues.
A buyer can’t check this independently. The city’s strategic plan (August 2024) says the registry “can currently be viewed only by the City,” so ask the seller for registration confirmations and get access set up in your name after closing.
Program fees are billed per unit, collected with Code Enforcement’s residential occupancy permit fee. The city’s landlords page says invoices go out in early November and are due in December. The most recent adopted schedule we could open is for fiscal year 2024-2025; as of October 2026 we could not locate the 2025-2026 or 2026-2027 schedules on the city’s site, and its landlords page still shows 2023-2024 amounts. The FY 2024-2025 schedule lists:
| Fee (FY 2024-2025 schedule) | Amount |
|---|---|
| Apartment (rent stabilized) units | $76 per unit per year |
| Non-rent-controlled units (TPO) | $28 per unit per year |
| Mobilehome spaces | $30 per space per year |
| Ellis Act filing, first 10 units | $2,833 per unit |
| Ellis Act filing, each unit over 10 | $951 per unit |
| Apartment late fee | 10% at 30 days past due, 50% at 60 days |
Fees are reset by council resolution, so confirm the current year’s figures with the city before you budget. The code lets the fee count as an operating expense in a fair return petition, but late charges can never be passed to tenants.
Duplexes, houses and newer buildings: state law fills the gap
Outside the ARO, the state Tenant Protection Act often applies. Civil Code 1947.12 caps increases at the figure the Attorney General publishes; Santa Clara County falls in the “all other counties” row, at 8.6% for increases between August 1, 2026 and July 31, 2027. The section does not reach units already under a stricter local cap, housing with a certificate of occupancy issued within the previous 15 years, or an owner-occupied two-unit building. It sunsets January 1, 2030.
A house or condo that can be sold separately is exempt only when two conditions are met: no real estate investment trust, corporation or LLC with a corporate member owns it, and the tenants were given the statutory exemption notice. Our AB 1482 guide for landlords covers the tests and the notice wording.
Just cause works the same way. Civil Code 1946.2(i) defers to a local just cause ordinance adopted on or before September 1, 2019, or to a later one that is more protective, and says no property is subject to both. Where the TPO applies, it is the rule to read first.
Due diligence checklist for a San José rental purchase
- Classify every unit. Confirm the certificate of occupancy date, the legal unit count and any unpermitted units, which the TPO covers.
- Get the registry record. Ask for the latest registration and fee invoices, and any fee exemption requests.
- Rebuild the rent history. For each unit, get move-in date, starting rent, each increase and its notice date, and any approved pass-throughs or pending petitions.
- Collect estoppels. Tenant estoppel certificates confirm rent, deposits and side agreements in writing.
- Ask about past terminations. Notices filed with the city, buyout agreements under Part 7, owner move-ins and relocation payments can all carry obligations forward.
- Read the title report for an Ellis memorandum or affordability restrictions.
- Price the transfer tax. San José’s Measure E tax applies at higher price levels; see our Santa Clara County city transfer tax guide.
Our guide to buying property with tenants in place covers deposits, leases and notices that transfer at closing.
Questions people ask
Does San José have rent control?
Yes. The Apartment Rent Ordinance limits increases to 5% once every 12 months for units in buildings of three or more units built and occupied before September 7, 1979. Newer apartment buildings are covered by the Tenant Protection Ordinance’s just cause rules and, in most cases, the state rent cap.
Are single-family homes in San José rent controlled?
Not under the city ordinance, which exempts single-family homes, duplexes, condos and townhomes. A house can still fall under the state cap of Civil Code 1947.12 unless it meets the separately-alienable exemption, which requires a non-corporate owner and a written notice to the tenant.
Can I raise rents to market after buying a pre-1979 fourplex?
No. A sale doesn’t reset rents. Existing tenancies stay at their current rent plus one increase of up to 5% per 12 months. The starting rent can be reset when a unit turns over through a voluntary move-out or a for-cause eviction.
Is a San José duplex covered by just cause rules?
The city’s ARO excludes buildings with only one or two units, and the city describes the TPO as covering buildings of three or more units. A duplex is usually governed by the state just cause rules in Civil Code 1946.2 instead, unless an exemption applies, such as an owner living in one unit of a two-unit structure.
How much does San José charge landlords per unit?
The FY 2024-2025 fee schedule lists $76 per rent stabilized apartment and $28 per non-rent-controlled unit per year, billed with the residential occupancy permit fee. The council resets fees by resolution, so check the city’s current figures.
Do I have to register units in the San José Rent Registry?
Yes, for rent stabilized units. Landlords must register each one annually with the actual rent paid, and the ordinance bars rent increases while a landlord is out of substantial compliance with a registration request.
What happens if I use the Ellis Act in San José?
You must give at least 120 days’ notice, deposit relocation assistance in escrow, record a memorandum that stays on title for 10 years, and follow re-rental rules. Units brought back within five years return at the prior lawful rent, and rebuilt units can become rent stabilized.
Buying rental property in San José
Diamond represents multifamily investors in San José, Oakland and Berkeley, and our guide on how to buy an apartment building lays out the full process. We manage some rental properties directly and work with partner managers for others. Diamond may refer you to partners we work with; you’re free to choose any provider. For a building you’re considering, start with our investor services, or read more about San José real estate and buying in Santa Clara County.
Sources & notes
- City of San José: Learn about rent stabilization (ARO coverage, 5% limit, exemptions)
- City of San José: Landlords and property managers (program fees, billing timing)
- City of San José: Welcome packet for landlords (registry, postings, notice filing)
- City of San José: 2024-2025 Fees and Charges, Housing Department (Rent Stabilization Program fees)
- City of San José: Memo on non-rent-control apartment per unit fee, FY 2023-2024 (Nov. 29, 2023)
- City of San José Housing Department: Rent Stabilization Program Strategic Plan 2024-2027 (Aug. 2024)
- GoCodebook: San José Municipal Code ch. 17.23, Part 2 Definitions (sec. 17.23.167)
- GoCodebook: San José Municipal Code ch. 17.23, Part 3 Initial rent and rent increases
- GoCodebook: San José Municipal Code ch. 17.23, Part 4 Fees
- GoCodebook: San José Municipal Code ch. 17.23, Part 9 Rent Registry
- GoCodebook: San José Municipal Code ch. 17.23, Part 11 Ellis Act
- GoCodebook: San José Municipal Code ch. 17.23, Part 12 Tenant Protection
- California Attorney General: Tenant Protection Act rent cap chart (modified July 16, 2026)
- California Public Law: Civil Code section 1947.12 (state rent cap and exemptions)
- California Public Law: Civil Code section 1946.2 (state just cause; local ordinances)
- California Public Law: Civil Code section 1954.52 (Costa-Hawkins)
Last reviewed October 2026 by Matthew Martinez.
