Sacramento Rental Laws Every Landlord Should Know in 2025 (SB 567, Rent Caps, Notices, Etc.)

Being a landlord in California has always required a sharp eye for legal detail. The regulatory landscape is complex, and in recent years, it has become even more so. For property owners in Sacramento, staying current on state and local ordinances isn’t just good practice—it’s essential for protecting your investment and avoiding costly lawsuits.

As we move into 2025, several key pieces of legislation, most notably the recent changes from Senate Bill 567 (SB 567), have significantly altered the rules for rent increases, evictions, and owner move-ins. Ignorance of these laws is not a defense. A single misstep can lead to severe financial penalties.

This definitive landlord legal guide will break down the critical Sacramento rental laws for 2025. We will explore statewide rent caps in Sacramento, explain the new requirements for SB 567 compliance, and detail the proper procedures for issuing tenant notices in Sacramento.

Disclaimer: This article is for informational purposes only and does not constitute legal advice. Landlords should consult with a qualified attorney to address their specific situations.

The Foundation: AB 1482 – The Tenant Protection Act of 2019

Before diving into the 2025 updates, it is crucial to understand the law that set the stage: The Tenant Protection Act of 2019 (AB 1482). This landmark legislation introduced two major concepts for most of California’s rental housing stock: statewide rent caps and “just cause” eviction requirements.

Most landlords are now familiar with its basic tenets, but it’s worth a quick review as it remains the foundation upon which new laws are built.

Statewide Rent Caps

AB 1482 limits annual rent increases to 5% plus the regional Consumer Price Index (CPI), with a maximum cap of 10%. This applies to most multi-family properties and single-family homes owned by corporations or real estate investment trusts (REITs).

• Example: If the Sacramento area CPI for the year is 3.2%, a landlord can increase the rent by a maximum of 8.2% (5% + 3.2%).

“Just Cause” Eviction Protections

After a tenant has lived in a unit for 12 months, a landlord cannot simply terminate their tenancy. They must state a specific, legally valid reason. These reasons fall into two categories:

• At-Fault Just Cause: This includes actions by the tenant, such as failure to pay rent, breach of the lease agreement, creating a nuisance, or engaging in criminal activity.
• No-Fault Just Cause: This includes situations where the tenant has done nothing wrong, but the landlord needs to recover the property. The primary reasons are:
  • The owner or their close family member intends to move into the unit.
  • The owner plans to withdraw the unit from the rental market entirely.
  • The owner must comply with a government order to vacate the property.
  • The owner plans to substantially remodel the property.

Crucially, “no-fault” terminations require the landlord to provide relocation assistance to the tenant, typically equal to one month’s rent.

Exemptions from AB 1482

Certain properties are exempt from these rules. The most common exemption is for single-family homes and condos owned by individuals (not corporations), provided that the lease includes specific language notifying the tenant of this exemption. Newer construction (properties with a certificate of occupancy issued within the last 15 years) is also exempt.

The Game Changer for 2025: Understanding SB 567

Senate Bill 567, which took effect on April 1, 2024, was designed to close perceived loopholes in AB 1482, particularly concerning “no-fault” evictions. This new law adds significant requirements and penalties for landlords. For SB 567 compliance in 2025, every Sacramento landlord must understand these changes.

Key Changes Introduced by SB 567

1. Stricter Rules for Owner Move-In Evictions

Previously, a landlord could terminate a tenancy for an “owner move-in” with relatively few checks. SB 567 makes this much more difficult.

• Occupancy Requirement: The owner or their designated family member must move into the unit within 90 days of the tenant vacating and must reside there as their primary residence for at least 12 consecutive months.
• Named Individual: The notice to terminate must include the name of the person who will be moving in and their relationship to the owner.
• Limited to “Natural Persons”: Only properties owned by individuals (“natural persons”) or held in a family trust qualify for owner move-in evictions. Properties owned by LLCs or other corporate entities can no longer use this as a reason for eviction.

2. Redefined “Substantial Remodel” Evictions

The “substantial remodel” no-fault eviction was often criticized as a way to push out long-term tenants to raise rents. SB 567 drastically narrows its definition and adds hurdles.

• Definition of “Substantial Remodel”: The work must be significant enough that it requires the tenant to vacate for at least 30 days. It cannot be cosmetic (like painting or new flooring). It typically involves structural, electrical, or plumbing work that requires government permits.
• Permits and Documentation: The landlord must provide the tenant with copies of the permits, a description of the work, and the expected duration of the construction with the termination notice.
• Option to Return: The landlord must give the tenant the option to return to the property at the same rental rate once the remodel is complete. If the tenant chooses this option, the landlord must notify them when the unit is ready.

3. Increased Penalties for Non-Compliance

The financial risks of violating these rules have skyrocketed under SB 567.

• Actual and Punitive Damages: If a landlord is found to have wrongfully evicted a tenant (e.g., they claimed an owner move-in but then re-rented the unit on Airbnb), the tenant can sue for actual damages, punitive damages, and attorney’s fees.
• Treble Damages: The law creates a presumption that the landlord acted in bad faith if they fail to follow the new rules, potentially leading to treble (triple) damages.

For landlords, this means that every step of a no-fault termination must be perfectly executed and documented. Our firm’s Proven Process for tenant management includes rigorous documentation to protect our clients from these types of claims.

Sacramento’s Local Ordinances: Tenant Protection Program

While state laws provide a baseline, Sacramento has its own Tenant Protection Program that adds another layer of regulation. Landlords must comply with both state and city rules.

Sacramento’s Relocation Assistance

The city’s program often requires higher relocation assistance for no-fault evictions than the state’s minimum of one month’s rent. The amount can be two or even three times the monthly rent, depending on the tenant’s circumstances (e.g., if they are part of a low-income household, have minor children, or are seniors).

Just Cause Ordinance

The city of Sacramento has its own just cause ordinance that mirrors many aspects of AB 1482 but may have subtle differences. It is critical to check the city’s specific requirements, especially regarding which properties are covered.

Navigating these overlapping state and local laws can be incredibly confusing. This is a primary reason why many Sacramento landlords choose to partner with a professional property management company that specializes in local compliance. If you have questions about your property, don’t hesitate to contact us for a consultation.

A Practical Guide to Tenant Notices in Sacramento

Properly serving notices is a fundamental part of legally compliant landlording. A small error in the wording or delivery method of a notice can render it invalid, forcing you to start the process over and costing you weeks of lost rent.

Here are the most common tenant notices in Sacramento and how to handle them.

1. Notice to Pay Rent or Quit

This is the first step in the eviction process for non-payment of rent.

• Content: The notice must state the exact amount of rent due (and nothing else—no late fees or other charges), the name and address of the person to whom the rent can be paid, and their hours of availability.
• The “Cure” Period: California law gives tenants a three-day period to “cure” the violation by paying the full amount. These are three business days, not including weekends or holidays.
• Service: The notice must be properly “served” to the tenant. The preferred method is personal service (handing it directly to the tenant). If that is not possible, “substitute service” (leaving it with another adult at the property and mailing a copy) or “posting and mailing” (taping it to the door and mailing a copy) can be used.

2. Notice to Perform Covenant or Quit

This notice is used when a tenant violates a specific term of the lease agreement, other than non-payment of rent.

• Examples: Having an unauthorized pet, creating a nuisance, or subletting without permission.
• Content: The notice must clearly describe the lease violation and state what the tenant must do to fix (“cure”) it.
• The “Cure” Period: The tenant has three days to correct the violation. If the violation is not something that can be fixed (e.g., illegal activity), the notice can be an incurable “Notice to Quit.”

3. Notice of Rent Increase

This is one of the most common notices a landlord will issue.

• Timing: For rent increases of 10% or less, a 30-day written notice is required. For increases of more than 10% (which is now rare due to rent caps), a 90-day notice is required.
• Calculation: Ensure your increase complies with the rent caps in Sacramento (5% + CPI, not to exceed 10%). Calculate this carefully based on the correct CPI data for the Sacramento region.
• Service: This notice must be in writing and can be served personally or by mail. If serving by mail, you must add five calendar days to the notice period.

4. Notice to Enter Dwelling Unit

Landlords have a right to enter a rental unit for specific reasons, but they cannot do so without proper notice.

• Reasons for Entry: Valid reasons include making necessary repairs, showing the unit to prospective buyers or tenants, or in an emergency.
• Notice Period: A “reasonable” written notice is required, which is presumed to be 24 hours.
• Content: The notice must state the date, approximate time of entry, and the purpose of the entry. The entry must be during normal business hours.

5. Notice of Termination of Tenancy (No-Fault)

As discussed under SB 567, these notices are now highly regulated.

• Notice Period: A 60-day notice is generally required for tenancies of one year or more.
• Content: The notice must state the specific “just cause” reason for the termination (e.g., owner move-in). It must also inform the tenant of their right to relocation assistance and include all the new documentation required by SB 567 (permits, names of new occupants, etc.).

Given the complexity and high stakes, using attorney-drafted templates or having a professional service handle these notices is the safest path forward.

Other Important Legal Considerations for 2025

Beyond the major statutes, several other rules impact day-to-day property management in Sacramento.

Security Deposits

• Maximum Amount: A landlord can charge a maximum of two months’ rent for an unfurnished unit and three months’ rent for a furnished unit.
• Return Timeline: As mentioned, you have exactly 21 calendar days after the tenant moves out to return their deposit with an itemized statement of deductions. Failure to meet this deadline can result in penalties.
• New Law (AB 12): Starting July 1, 2024, a new law caps security deposits at just one month’s rent, regardless of whether the unit is furnished or not. Small landlords owning no more than two properties with a total of no more than four units are exempt and can still charge up to two months’ rent.

Fair Housing Laws

Landlords are prohibited from discriminating against tenants based on protected classes, which include race, religion, national origin, sex, familial status, and disability.

• Source of Income: In California, “source of income” is a protected class. This means you cannot refuse to rent to an otherwise qualified tenant simply because they use a Section 8 voucher or another form of rental subsidy.
• Reasonable Accommodations: You must make reasonable accommodations for tenants with disabilities, such as allowing a service animal in a “no pets” building or providing a designated parking space.

Screening and Application Fees

• Maximum Fee: The application screening fee is capped by law and adjusts annually for inflation. For 2024, it was around $62. You can only charge for your actual out-of-pocket costs for credit reports and background checks.
• Provide Receipts: If the applicant requests it, you must provide a receipt showing the cost of the screening. If you do not run a check, you must return the fee.

The Value of Professional Property Management

This landlord legal guide only scratches the surface. The web of Sacramento rental laws for 2025 is dense and constantly evolving. For an independent landlord, keeping up can feel like a full-time job. One missed update or procedural error can expose you to thousands of dollars in liability.

This is where professional property management in Sacramento becomes an invaluable asset. A dedicated management company’s entire business is built on compliance.

• Expertise: We live and breathe these laws every day. We subscribe to legal updates and work with attorneys to ensure our forms and procedures are always current.
• Systems: We have proven systems for everything from screening tenants to serving notices and handling security deposit dispositions, all designed to comply with SB 567, AB 1482, and local ordinances.
• Liability Shield: By placing a professional manager between you and the tenant, you create a buffer that reduces your personal liability. We handle the difficult conversations and ensure every action is documented and legally sound.

Conclusion: Protect Your Investment Through Compliance

Investing in Sacramento real estate can be a powerful engine for wealth creation, but it operates within a framework of strict rules. The changes brought by SB 567 represent a significant shift, placing a greater burden on landlords to justify their actions, particularly when it comes to no-fault terminations.

To succeed in 2025, you must be more than just a property owner; you must be a diligent and informed operator.

1. Understand Rent Caps: Know how to calculate and apply lawful rent increases.
2. Master No-Fault Evictions: Follow the new, stricter rules for owner move-ins and substantial remodels to the letter.
3. Perfect Your Notices: Use correct, up-to-date forms and serve them properly.
4. Stay Informed: Laws change. Continuously educate yourself on state and local updates.

If this feels overwhelming, you are not alone. Many successful investors choose to focus on what they do best—finding great properties—and leave the complex day-to-day legal compliance to experts.

Ready to ensure your investment is protected?
Learn more about our compliant management practices by reviewing our Proven Process or Contact Us today for a personalized assessment of your property management needs.