San Francisco Wants to Cap Surprise 'Banked' Rent Hikes at 10% a Year. Here's What That Means for Renters

If you rent a rent-controlled apartment in San Francisco, a pending proposal could limit how big a single year's rent increase can get. It is part of the rent emergency package Mayor Daniel Lurie announced in September, and it is still working its way through the Board of Supervisors.

What 'banked' rent is

Under city rent rules, a landlord who skips all or part of the yearly allowed increase can save, or "bank," that amount and add it later. After several years, that can add up to one large jump. The proposal, from District 3 Supervisor Danny Sauter, would cap the combined yearly increase from banked rent and capital improvement charges at 10% for rent-controlled tenants, according to the mayor's office.

Landlords would not lose the money. Apartment News Publications, a trade outlet for rental owners, reported that amounts above the 10% cap could only be applied on or after Jan. 1, 2030. The cap would run through Dec. 31, 2029, unless extended, and would apply to rent increase notices and capital improvement petitions dated on or after Sept. 15, 2026, the day the ordinance was introduced.

What it does not do

It does not create a new 10% annual increase. The ordinary allowable increase for covered units stays at 1.6% through Feb. 28, 2027, set by the city's Rent Board. The 10% figure is only a ceiling on how much extra, saved-up rent can hit a tenant at once. The San Francisco Standard had to correct an early story that mischaracterized the limit.

"Annual rent increases from banked rent and capital improvement charges will be capped at 10% for rent-controlled tenants," Sauter said in the mayor's announcement, adding that he is a renter himself.

The rest of the package

The broader plan includes six proposed ordinances and more than $30 million, according to the city. That covers $3 million more for the Tenant Right to Counsel program, which provides eviction lawyers, and $27 million for extremely low-income families whose federal Emergency Housing Vouchers are running out. Another proposal from Supervisor Matt Dorsey would require landlords to give tenants yearly notices about rent increase limits and eviction rules.

What happens next

The Board of Supervisors referred Sauter's ordinance to the Rent Board for comment, according to the city's legislative record. It still needs committee review and a full board vote before it becomes law.