What Will the 2023 Rental Reform Legislation Change?

With the 2023 rental reform legislation looming on the horizon, landlords and tenants across the country are eagerly anticipating what changes will take place. Here's a breakdown of what the new legislation is set to cover.

Rent Increases

One of the most significant changes being brought about by the 2023 rental reform legislation is the limitation on allowable rent increases. The bill proposes that landlords should only be allowed to increase rent once a year, and the increase cannot be more than 5% plus the inflation rate. This is a significant decrease from the current allowable cap of 10% plus inflation and will be welcome news for tenants who have struggled with increasing rental prices in recent years.

Exceptions: There are some exceptions to this rule, such as when a property undergoes significant renovations or improvements. In this case, landlords may be allowed to increase rent by up to 7.5%.

Enforcement

The enforcement of this new rule will be overseen by local and state housing authorities. Failure to comply with the limitations on rent increases will result in penalties for landlords.

Security Deposits

Another major area of reform under the 2023 rental legislation is security deposits. Currently, landlords can charge up to two months' rent as a security deposit. This can be a significant burden for tenants, particularly those who are just starting out and may not have a lot of savings.

Under the new legislation, landlords will only be allowed to charge one month's rent as a security deposit. Additionally, landlords will have to return the deposit within 14 days of the tenant moving out, unless they provide written notice to the tenant explaining why the deposit is being withheld.

No-Interest Rule

Another change is the elimination of the requirement for landlords to pay interest on security deposits. Previously, landlords had to hold security deposits in an interest-bearing account and return the interest to tenants. Under the new legislation, this requirement will be removed.

Right to Repair and Habitability

The 2023 rental reform legislation will also give tenants more rights with regard to the habitability of their homes. Currently, landlords must make necessary repairs to rental properties but are not required to do so in a timely manner. This can lead to situations where tenants are living in unsafe or unsanitary conditions.

Under the new legislation, landlords will be required to make necessary repairs within 14 days of being notified by the tenant. If the landlord fails to make the repair within this time frame, the tenant may be allowed to make the repair themselves and deduct the cost from their rent.

Exceptions: There are some exceptions to this rule, such as when the tenant or their guests caused the damage.

Habitability

With regard to habitability, the new legislation will require landlords to maintain their properties in a state that is safe, sanitary, and fit for human habitation. This includes providing working plumbing, heating, and electrical systems. Failure to maintain habitability will result in penalties for the landlord.

No-Fault Evictions

The 2023 rental reform legislation will also address the issue of no-fault evictions. Currently, landlords can evict tenants for no reason, as long as they provide the required notice and follow the proper legal procedures.

Under the new legislation, landlords will be required to justify evictions. This means they will need to provide a legitimate reason for the eviction, such as nonpayment of rent or violation of the lease agreement. This change will provide more protection for tenants against unfair evictions.

Exceptions: There are exceptions to this new rule, such as when a landlord needs to move into the property themselves or if they plan to sell the property.

Conclusion

The 2023 rental reform legislation is set to bring about significant changes in the rental market. From limiting rent increases to providing greater rights for tenants in terms of repairs and habitability, this legislation is designed to create a fairer and more balanced system for landlords and tenants alike. By being aware of these changes and understanding how they will impact rental agreements, landlords and tenants can better navigate the rental market and ensure a positive experience for all involved.