Dan Buckley
Associate Editor
Loyola University Chicago School of Law, JD 2026
In response to the January 2025 wildfires that have burned through Los Angeles County (L.A. County), California Governor Gavin Newsom issued numerous executive orders including Executive Order N-9-25, which extended renter protections against price gouging on hotel and motel rates, as well as rental housing prices across the county. Around 12,000 homes and buildings have been destroyed in the fires, leaving behind a worsening shortage of affordable housing for Los Angeles residents. To make matters worse, as the housing supply in L.A. County has suffered, there have been reports of price gouging on rent and housing costs by landlords and property owners. California law protects residents from price gouging following a natural disaster through a 10% cap on price increases. Thus, tenants’ rights advocates have called for strict enforcement against those who impose excessive price increases in violation of this regulation.
Loss of housing and evidence of price gouging in Los Angeles
Even before the recent fires, L.A. County faced a severe affordable housing shortage and an increasingly competitive rental market. In 2023, the Angeleno Project found that to meet demand Los Angeles would need an additional 270,000 housing units. The study also found that 80% of Los Angeles renters living below the poverty line had spent more than half of their incomes on housing in 2023.
Additionally, rental prices in Los Angeles were already high and the fires only exacerbated this issue. According to data analyzed by the Washington Post (Post), the median rental price for an apartment in L.A. County two weeks before the fires started was $2,300. However, the same study found that in the two weeks following the start of the fires, the median price for an apartment in L.A. County had risen to $2,625, a 14% increase from the beginning of the month. Across all property types in L. A. County, the Post reported that rental prices had increased by about 20%. This median increase is well above the 10% cap imposed by California law and the recent fires have brought calls for tighter enforcement of the law by government officials.
California Penal Code section 396 prohibits any price increase of over 10% after an emergency has been declared, including on rental housing, and violations are punishable by fines and up to a year in jail. These protections against price gouging generally last for 30 days following an emergency, but Governor Newsom’s Order N-9-25 ensured those protections will stay in effect until at least March 8th, 2025.
California officials have thus already begun to act against those in violation of the law. In his January 18th press conference, California Attorney General Rob Bonta warned potential price gougers of consequences and later announced that criminal charges had already been filed against one local real estate agent. The real estate agent allegedly increased a Los Angeles couple’s rental price by 38% following the start of the fires and was subsequently charged. Robert Luna, the L.A. County Sheriff, also warned against this type of rental price increase, stating that authorities would pursue anyone who tried to take advantage of other people in this way.
Proposed recommendations and future impacts
As reports of suspected price gouging have continued to rise following the fires, it is clear that regulations like these must be enforced to protect renters. The Los Angeles County Department of Consumer and Business Affairs reported that it had received over 260 complaints regarding alleged instances of price gouging. Officials should pursue these complaints as a message to property owners that price gouging will not be tolerated. Governor Newsom should also continue to extend these protections for as long as they are necessary and work with officials to continue to pass adjoining legislation to spur the re-development of lost buildings and homes.
The outcomes of these post-emergency measures against price gouging will serve as an important case study for other states and cities across the country as rising temperatures have led to increasingly severe natural disasters. State and local authorities should prepare for future emergencies by advancing legislation to rapidly increase the supply of affordable housing and protect renters from excessive price increases. Furthermore, it is essential to implement regulations against price gouging on essential goods such as groceries and baby formula to further safeguard consumers after emergencies like the wildfires in California.