Does the Los Angeles County Price Gouging Cap Still Limit South Bay Rent Increases? Penal Code Section 396

Published August 10, 2026

Penal Code section 396 caps rent increases at 10 percent once a state, county, or local emergency is declared, and it binds landlords everywhere in California, incorporated city or not. LA County's own emergency dates to January 7, 2025. Whether the 30 day renewal clock is still running in August 2026 is not something we could confirm from a fixed public record, since it depends on the Board's most recent vote.

The short answer

Penal Code section 396 caps rent increases at 10 percent once a qualifying emergency is declared, and it is state law, so it binds every landlord in California, incorporated city or not. Los Angeles County's Board of Supervisors declared a local emergency on January 7, 2025 for the county's wildfires. Whether the 30 day renewal clock the statute requires is still running as of today is not something we could confirm from a fixed source, since renewal is a recurring vote, not a fixed law.

Last verified: August 10, 2026

The cap itself, and why it is not a county rule

Penal Code section 396 is a state statute, not a Los Angeles County ordinance. That distinction matters for the South Bay because it means the cap does not care about city limits. Once the President, the Governor, or a local governing body proclaims a state of emergency or declares a local emergency covering an area, it becomes unlawful for a period of 30 days following that proclamation for any person to increase the rental price of housing in the affected area by more than 10 percent, subject to specific exceptions. That rule reaches El Segundo, Manhattan Beach, Hermosa Beach, Redondo Beach, Torrance, Hawthorne, Inglewood, Gardena, and Carson exactly the same way it reaches unincorporated county land, because the statute is triggered by the emergency proclamation covering the area, not by whether the city has its own city council.

The statute defines "rental price" with specific rules. For housing that was rented within the year before the declaration, the baseline is the actual rent the current tenant paid, or the most recent advertised price if the unit was vacant. For housing that was never rented or advertised in that prior year, the ceiling is 160 percent of the fair market rent published by the U.S. Department of Housing and Urban Development. A landlord who converts a unit from unfurnished to furnished after the declaration may add a further 5 percent. None of this is optional guidance. Penal Code section 396 is a criminal statute, and a violation can carry fines and jail time.

The protection period is 30 days from the proclamation or declaration. Section 396, subdivision (e) lets the declaring authority extend that period in additional 30 day increments if it finds the extension necessary to protect the lives, property, or welfare of residents. That is the mechanism, not a fixed calendar date, which is why any answer about whether the cap is "currently" in effect has to point to the latest vote rather than to the statute's text alone.

LA County's own emergency and the county ordinance layered on top

Los Angeles County's Board of Supervisors declared a local emergency on January 7, 2025 in response to the wildfires that devastated parts of the county, including the Eaton and Palisades fires. That declaration independently triggers Penal Code section 396's statewide 10 percent cap for rental housing across the county for as long as the declaration, and any 30 day extensions of it, remain in force.

Separately, the county has its own price gouging ordinance, County Code Chapter 8.09, which largely mirrors the state statute but adds county-level administrative enforcement through the Department of Consumer and Business Affairs, including cease and desist letters, administrative fines, and hearings. Until an urgency ordinance the Board of Supervisors revised in August 2025, that county-level enforcement authority reached only the unincorporated parts of the county. The revision changed that. The ordinance's own findings state that the Department of Consumer and Business Affairs had received more than 3,800 complaints alleging price gouging since the January 7, 2025 declaration, the vast majority related to housing, and that those complaints were coming from both unincorporated areas and incorporated cities. The Board's response was to expand Chapter 8.09's requirements and enforcement authority to apply countywide, including incorporated cities, not just the unincorporated area.

Practically, that means a South Bay landlord in an incorporated city faces two overlapping layers during a covered emergency: the state statute, Penal Code section 396, which has always applied there directly, and now the county's own administrative enforcement machinery under Chapter 8.09, which previously would not have reached a Gardena or Hawthorne rental but now does.

Quick reference

| Question | Answer | Citation |

|---|---|---|

| What is the cap | 10 percent above the pre-emergency rental price | Penal Code 396 |

| Who does it bind | Every landlord in the affected area, incorporated city or not | Penal Code 396 |

| Baseline for a previously rented unit | Actual rent paid, or most recent advertised price | Penal Code 396 |

| Baseline for a never-rented unit | 160 percent of HUD fair market rent | Penal Code 396 |

| Base protection period | 30 days after the proclamation or declaration | Penal Code 396 |

| Can it be extended | Yes, in 30 day increments, by the declaring authority | Penal Code 396(e) |

| Does LA County Code Chapter 8.09 reach incorporated South Bay cities | Yes, as of the county's August 2025 urgency ordinance | LA County Code Chapter 8.09, BOS-2025-048 |

| Is the cap definitely active right now | Not confirmed from a fixed source, check current status | See unconfirmed items above |

Where the uncertainty actually sits

We were able to confirm the legal mechanism in full: the 10 percent cap, its statewide reach regardless of incorporation, the January 7, 2025 county declaration, and the county's own August 2025 expansion of administrative enforcement to incorporated cities. What we could not confirm from a fixed, retrievable source is whether the Board of Supervisors' most recent 30 day renewal is still current as of today. That is not a gap in the law, it is the nature of a renewal mechanism: it is only ever as current as the last vote. Before relying on the cap being active, or advising a client that it has lapsed, check the Department of Consumer and Business Affairs' price gouging page directly or call their consumer line, since that page reflects whatever the Board most recently did.

FAQ

Does Penal Code section 396 apply in Gardena, Hawthorne, or any other incorporated South Bay city?

Yes. It is a state statute triggered by a qualifying emergency proclamation, and it applies to every affected area in California regardless of whether the area is an incorporated city or unincorporated county land.

Is the 10 percent cap a permanent rule, or does it turn on and off?

It turns on when a qualifying state, county, or local emergency is declared, runs for 30 days, and can be extended in further 30 day increments by the authority that declared it. It is not always in effect.

What emergency triggered the current LA County analysis?

The Board of Supervisors' declaration of a local emergency on January 7, 2025, in response to the county's wildfires, including the Eaton and Palisades fires.

Did the LA County ordinance always apply to cities like El Segundo or Torrance?

No. Until the Board of Supervisors revised County Code Chapter 8.09 in an August 2025 urgency ordinance, the county's own administrative enforcement reached only unincorporated areas. The revision expanded it countywide.

How do I find out if the cap is active right now?

Check the Department of Consumer and Business Affairs' price gouging page at dcba.lacounty.gov or call their consumer line, since the answer depends on whether the declared emergency and any extensions are still current.

What can a landlord charge if the unit was never rented before the emergency?

No more than 160 percent of the fair market rent for the area as published by the U.S. Department of Housing and Urban Development, under Penal Code section 396.

This is general information, not legal advice. Confirm the current status of any declared emergency and your specific pricing plan with the Department of Consumer and Business Affairs or a licensed attorney before setting a rent increase.

Topics: compliance, landlord law, rent increases, South Bay, price gouging

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