SB 493 and SB 1365: Watching These Price-Gouging Bills

California apartment owners are already operating in one of the most regulated rental housing markets in the country. Between statewide rent caps, local tenant protections, insurance increases, higher repair costs, permitting delays, and more conservative buyer underwriting, the margin for error has become smaller for multifamily owners.

Now, two bills moving through the California Legislature — SB 493 and SB 1365 — could further affect how rental housing providers respond after a declared emergency.

As of August 28, 2026, both bills are still active and moving through the Assembly. SB 1365 was ordered to third reading on August 20, 2026, meaning it is positioned for an Assembly floor vote. SB 493 is also in progress, with the latest version dated August 21, 2026. The California Legislature’s current calendar shows August 17–31 as floor-session only, and August 31, 2026 is the last day for each house to pass bills. That means these bills could be voted on before the Legislature adjourns on August 31.

For San Diego multifamily owners, this is worth paying attention to.

What Are SB 493 and SB 1365?

Both bills deal with California’s existing anti-price-gouging law, which generally limits certain price increases after a declared emergency.

Under existing law, after a state or local emergency is declared, rental housing price increases are generally restricted to no more than 10% for a specified period, including any extension of the emergency declaration. SB 1365 would revise parts of that framework for rental housing, including how repair and improvement-related increases are treated and how certain daily-rate housing is calculated after an emergency.

SB 493 would expand the definition of a state of emergency for price-gouging purposes to include war, if there is a presidential or gubernatorial declaration and the California Attorney General issues a written opinion finding a sufficient connection between the war and price increases for essential goods or services.

On their own, these bills are technical. For rental housing owners, the concern is what they could mean in practice: more uncertainty around rent adjustments, repairs, improvements, and how housing providers can respond during extended emergency periods.

Why SB 493 Matters to Property Owners

SB 493 is broader than rental housing. It is aimed at price gouging during war or armed conflict. Supporters frame it as a consumer protection measure intended to prevent excessive price increases on essential goods and services during periods of war-related disruption.

However, for rental housing providers, the concern is that California already has emergency price-gouging rules that affect rents after declared emergencies. Expanding the types of emergencies that can trigger those rules could create more periods where rent increases are limited, even when owners are facing rising costs.

That matters because emergencies are not always short or simple. Emergency declarations can be extended. During those periods, owners may still face higher insurance premiums, repair costs, labor costs, financing costs, taxes, utilities, and compliance expenses.

From an apartment owner’s perspective, the issue is not whether price gouging should be allowed. It should not be. The concern is whether a broader emergency trigger could unintentionally restrict legitimate rental housing operations and make it harder for owners to respond to real cost increases.

Why SB 1365 May Be More Directly Relevant to Multifamily Owners

SB 1365 appears more directly tied to rental housing operations.

Under current law, rent increases above 10% after an emergency can be exempted if the owner can prove the increase is directly attributable to additional costs for repairs or additions beyond normal maintenance that were amortized over the rental term.

SB 1365 would change that framework by making certain exemptions an affirmative defense to a price-gouging charge. It would also narrow the repairs-and-improvements language by focusing on costs incurred within the year before the emergency declaration and requiring additional proof tied to rental use or intent to rent.

In plain English, that could make things more complicated for owners who improve a property, repair major systems, bring a vacant unit back online, or reposition a building and then need to justify a rent increase after an emergency declaration.

This is especially important for older San Diego apartment buildings. Many local multifamily properties need capital improvements, including:

• Roof repairs or replacement
• Sewer line work
• Electrical upgrades
• Plumbing repairs
• Foundation or structural repairs
• Balcony and deck work
• Drainage improvements
• Unit renovations
• Safety and code compliance work

These are not cosmetic upgrades in many cases. They are necessary improvements that protect the property, improve habitability, and preserve housing supply.

If owners become less confident that they can recover those costs through future rent adjustments, some may delay repairs, avoid renovations, or underinvest in older housing stock. That is bad for owners, tenants, and the long-term quality of San Diego’s rental housing.

Why This Matters for San Diego Multifamily Values

Apartment values are tied to income, expenses, risk, and buyer confidence.

When buyers evaluate a San Diego apartment building, they are not just looking at the current rent roll. They are asking:

• Are rents at market?
• Are there legal limits on future rent increases?
• What capital improvements are needed?
• Can those costs be recovered over time?
• What is the cap rate?
• Will the debt coverage ratio work?
• How much uncertainty is there around future income?
• How much risk should be priced into the offer?

If rent growth becomes less predictable or repair-related increases become harder to support, buyers may underwrite more conservatively. That can affect pricing, especially for value-add properties or older buildings with deferred maintenance.

This is one of the biggest concerns for San Diego multifamily owners. A law does not have to directly reduce a property’s rent today to affect value. If it changes how buyers view future income, repair recovery, or regulatory risk, it can still influence what a property is worth.

The Value-Add Problem

San Diego has a large inventory of older 2–4 unit properties and small apartment buildings. Many of these properties were built decades ago and require ongoing maintenance and reinvestment.

Value-add investing has historically played an important role in improving this housing stock. Buyers purchase older buildings, invest capital, improve the property, and bring rents closer to market over time.

But value-add projects only work when the economics make sense. If an investor cannot reasonably predict whether rent increases will support the cost of repairs, improvements, financing, and insurance, they may walk away or offer less.

That can create a ripple effect:

• Fewer buyers pursue older properties.
• Sellers receive lower offers.
• Deferred maintenance continues.
• Tenants remain in lower-quality housing.
• Renovation projects become harder to justify.
• Smaller owners may be pushed out of the market.

This is why multifamily owners should not ignore policy changes that appear technical. These details directly affect underwriting.

These Bills Could Add More Uncertainty to an Already Challenging Market

San Diego multifamily owners are already dealing with a more disciplined market.

Buyers are underwriting harder. Interest rates remain a major factor. Insurance has become more expensive and harder to place. Repairs and construction costs remain elevated. Many properties need capital improvements, but owners are already cautious about spending money if the return is uncertain.

At the same time, apartment buyers are paying close attention to cap rates, GRMs, debt coverage, rent levels, and property condition. If a bill creates additional uncertainty around future rent adjustments, that uncertainty gets priced into the deal.

That does not mean every property loses value overnight. But it does mean owners need to understand how legislation can affect buyer behavior.

What San Diego Apartment Owners Should Do Now

If you own rental property in San Diego, this is a good time to get organized.

Before any emergency-related rent restriction becomes an issue, owners should have clear documentation for:

• Current rent rolls
• Leases and lease start dates
• Rent increase notices
• Repairs and capital improvements
• Contractor invoices
• Permits
• Before-and-after photos
• Insurance premiums
• Utility costs
• Operating expenses
• Vacancy and turnover records

Documentation matters. If the law requires owners to prove that a rent increase is connected to real costs, the owner with clean records is in a much better position than the owner trying to recreate everything after the fact.

Owners should also speak with a qualified attorney, property manager, or apartment association before issuing rent increases during or after a declared emergency.

When Will SB 493 and SB 1365 Be Voted On?

As of this writing, the bills do not appear to have a single publicly listed guaranteed vote date. However, both are positioned for final Assembly action during the end-of-session floor period.

The important dates are:

• SB 1365: Ordered to third reading on August 20, 2026.
• SB 493: Latest version dated August 21, 2026, currently in progress.
• August 17–31, 2026: Floor-session-only period for the Legislature.
• August 31, 2026: Last day for each house to pass bills.

That means owners who oppose these bills should contact their Assemblymember as soon as possible.

Who Should You Contact to Oppose SB 493 and SB 1365?

Because these bills are awaiting Assembly action, owners should contact their California Assemblymember and ask them to vote NO on SB 493 and SB 1365.

You can find your Assemblymember here:

California State Assembly — Find My Representative
Use the official Assembly website and enter your property address or home address to identify your Assemblymember. The Assembly site allows Californians to find and contact their State Assemblymember and State Senator.

When contacting your Assemblymember, keep the message short and clear.

Suggested message:

Subject: Please Vote NO on SB 493 and SB 1365

Dear Assemblymember [Name],

I am a California rental housing provider / multifamily property owner, and I am asking you to vote NO on SB 493 and SB 1365.

Rental housing providers are already facing rising insurance costs, repair costs, utility expenses, financing challenges, and strict rent regulations. These bills would add more uncertainty around emergency rent restrictions, repairs, improvements, and legitimate cost recovery.

I oppose price gouging, but these bills could make it harder for responsible owners to maintain and improve rental housing, especially older apartment buildings that require significant capital investment.

Please vote NO on SB 493 and SB 1365.

Thank you,
[Your Name]
[City / Property Location]

Bottom Line for San Diego Multifamily Owners

SB 493 and SB 1365 are worth watching because they could further complicate how rental housing providers handle rent increases, repairs, improvements, and pricing after declared emergencies.

For San Diego apartment owners, the concern is not just compliance. The concern is how additional uncertainty affects property operations, buyer underwriting, capital improvements, and long-term multifamily values.

In today’s market, buyers are already more cautious. Anything that creates more uncertainty around future income or cost recovery can affect how properties are valued.

If you own apartment buildings in San Diego, now is the time to understand the bills, contact your Assemblymember, and make sure your property records are organized. Even if these bills do not directly affect your property today, they are part of a broader regulatory environment that every California multifamily owner needs to understand.