Gov. Newsom lifts price caps for new rental homes in wealthy L.A. neighborhoods

Gov. Gavin Newsom has lifted a price cap on new rental listings for some single-family homes in Los Angeles, responding to concerns that the rules had been restricting the availability of housing in the wake of last month’s wildfires.

Triggered by the Eaton and Palisades fires, California’s price-gouging laws have limited the monthly rental price for Los Angeles County properties that had not been offered for rent in the previous year to, in effect, no higher than $9,554 a month. That amount was below pre-fire prices for larger houses in wealthier neighborhoods. Real estate analysts have told The Times that the price cap could be keeping thousands of potential rentals off the market. More than 11,500 homes were destroyed in last month’s fires.

Under an executive order issued Monday, Newsom waived the price-gouging rules for new rental listings of single-family-homes of four bedrooms or larger in Bel Air, Beverly Hills, Brentwood and 24 other ZIP codes.

“This executive order provides targeted relief from regulations that impact victims and would otherwise slow this community’s quick recovery,” Newsom said in a release.

Other provisions of the price-gouging law remain in effect, including one that prohibits landlords with properties offered for rent within the past year from increasing the price by more than 10%.

Newsom’s order Monday also expanded those protections. As written, the price-gouging laws apply to leases of one year or less. Amid reports that landlords were skirting the rules by having tenants sign 366-day leases, Newsom’s order extends the rules to rental agreements of any length.

The price-gouging restrictions will last until March 8 unless extended.