California enacted a law this month requiring rental homes to have working stoves and refrigerators, a move that could make them more competitive with major apartment property owners in the search for tenants.
The law may seem odd or unnecessary to those outside California, but it wasn't uncommon for renters in places like Los Angeles to move into an apartment without a refrigerator.
"This is the first state-wide law to mandate such a thing," said Johana Williams, the regional manager of Utopia Management in San Diego. "In other states, you can still legally offer a rental and require the tenant to supply their own refrigerator. The difference is that they don’t usually do that in other states. It happened mainly in California, and most particularly in the Southern metros, because the market is so expensive, even technically substandard units still find renters to house."
The new law is aimed at addressing smaller landlords who didn't always provide appliances as the larger ones did. The new law means smaller apartments will be held to the same standard as complexes run by such national companies as AvalonBay Communities, Greystar and Lincoln Property Company.
The prior regulation required dwelling units to have heating and hot water.
"AB 628 essentially expanded the definition of habitability to make these items a requirement," Williams said.
Since refrigerators and stoves are used for cooking, the law aims to ensure renters have a means to prepare food safely.
Assembly Bill 628 requires that units have "a stove and refrigerator that are maintained in good working order and are capable of safely generating heat for cooking purposes and capable of safely storing food, respectively." The law expands the criteria for determining whether a unit is fit for rental or "tenantable."
Who does this impact?
High-rise luxury developments in California are not omitting stoves and fridges from their development plans. However, that was not always the case with smaller developments.
"In our local market, San Diego, rentals tended to have refrigerators included, even if landlords were not required to provide them," Williams said. "This is especially the case for larger multifamily complexes. The same cannot be said of mom-and-pop rentals. The law itself is largely spurred by the activity of these independent landlords, and it’s expected to affect them the most."
Nontraditional rental units, such as a garage converted into an apartment, might not be fully equipped with these amenities. By putting the cost of expensive appliances on the renters, landlords were able to save and possibly offer lower rents.
"Expensive markets like Los Angeles and San Diego incentivize many property owners to offer lower-cost rentals," Williams said. "Often, as part of cutting upfront furnishing costs, these landlords require renters to bring their own appliances. This was totally legal before AB 628 because refrigerators and other appliances, like dishwashers and laundry machines, were considered amenities and therefore not essential items for habitability."
Fridges are expensive and hard to move. Renters who found themselves in a unit without a refrigerator had to pay for one and then figure out how to get a fridge into the space. When they moved, the fridge went with them. The cost burden fell on the renters, but now it will be up to the landlords.
California ranks fourth on Apartments.com's highest rent price ranking. The average cost to rent a one-bedroom apartment in California is $2,200 a month, according to Apartments.com, CoStar's multifamily affiliate. Rents creep up in high-demand areas such as the Bay Area and Southern California.
"I don’t think it will change the rental market throughout the entirety of California," Williams said. "It's mostly a Southern California thing. Even back when the law was first proposed, it was mainly the Los Angeles market [that was] known for having a lot of rentals without refrigerators. It happened here in San Diego, too, but to a lesser extent."
California ahead of the curb or behind?
So, will California be the only state to require refrigerators? For now, probably. Other high-demand rental markets may follow California's lead by requiring these appliances, but so far, no one else has.
"Looking at it from a wider view, it’s really not surprising that California is the first state to do something like this," Williams said. "The state had always been in the forefront of renter-friendly legislation, pioneering things like rent stabilization and eviction protections. And all of these protections became necessary first in the state precisely because of the highly expensive rental market here.
"Expensive metros tend to expose renters to terms and conditions that don’t easily become the norm in more average markets, simply because there is more market to absorb all the rentals, with or without the preferred amenities," she said.