Sell Your Commercial Property In California

The California rental market at a glance

California had 5,980,523 renter households in the Census Bureau's 2020-2024 American Community Survey, or 44.1% of 13,548,091 occupied homes. Another 3,527,922 California housing units, 24.1% of the total, sit in buildings of five or more units, per ACS table B25024.

California rental vacancy was 4.2% in the 2020-2024 DP04 housing profile. Median gross rent of $2,036 equals about 24.6% of the $99,122 median household income. Strain falls on renters: 55.3% of California renter households paid 30% or more of income on rent, per table B25070.

Five-year trends in California

California median gross rent rose 35.5% between the 2015-2019 and 2020-2024 ACS periods, from $1,503 to $2,036 a month. Median household income grew 31.7% over the same span, from $75,235 to $99,122. Rents outran incomes by 3.8 percentage points.

California added 90,837 renter households between the two periods, a 1.5% gain. Units in five-plus buildings rose 5.8%, adding 193,243 units. Population was flat at 0.0% growth, so new apartment stock mostly served existing demand rather than a surge of arrivals.

Rent growth was uneven across California. Sacramento County rents climbed 43.0% and San Joaquin County rents 43.5%, while Santa Clara County rose 26.0%. San Joaquin County lost 6.0% of its renter households over the period.

California county comparison

Median gross rent in the 12 most populous California counties runs from $1,300 in Kern County to $2,857 in Santa Clara County. Rental vacancy ranges from 2.8% in Contra Costa County to 5.7% in Alameda County, per each county's 2020-2024 ACS figures.

Los Angeles County has the highest renter share on the list at 54.1% and the most units in larger buildings at 36.0%. Riverside County is the most owner-heavy of the 12, with renters in 30.9% of occupied homes and 11.7% of units in five-plus buildings.

California landlord, tax and transfer rules

Civil Code Section 1946.2 requires just cause to end a California tenancy once a tenant has lived there 12 continuous months. No-fault terminations, such as owner move-in or withdrawal from the rental market, require relocation help or a one-month rent waiver. Buildings with a certificate of occupancy under 15 years old are exempt, and some cities add stricter local rules.

Civil Code Section 1950.5 caps California security deposits at one month's rent for most landlords, and requires an itemized statement and refund within 21 calendar days of move-out. A two-month cap applies only to small owners of no more than two properties and four units.

California property tax rests on Proposition 13. Apartment buildings are assessed at purchase price on a sale, then limited to 2% annual increases. Voter-approved bonds add to the 1% base rate by tax rate area, so the bill after a sale resets to the new price.

Revenue and Taxation Code Section 11911 lets counties charge documentary transfer tax of $0.55 per $500 of value. On a $5,000,000 sale that is $5,500 at the county rate. Some charter cities, including the City of Sacramento, add their own tax.

What this means if you sell in California

Owners who sell commercial property in California are priced on rent rolls, local rules and the post-sale tax reset. A building in Contra Costa County at 2.8% vacancy reads differently from one in Alameda County at 5.7%.

Because Prop 13 reassesses to the sale price, we model the buyer's new tax bill and the transfer tax, not the seller's current bill. Just-cause rules and any city ordinance also shape the rent roll a buyer will underwrite.

We review California buildings of five or more units in the 12 counties above and elsewhere in the state. Send the rent roll and the latest California tax statement, and we will set the property against these county figures.