Landlords accused of illegal price gouging amid California wildfire crisis

HOUSTON, United States

The deadly California wildfires are spawning illegal price gouging by landlords who are jacking up prices for rental properties for tens of thousands of displaced residents, according to US media.

Since the massive wildfires began last Tuesday, more than 150,000 residents have been evacuated from the Los Angeles area where the blazes are raging out of control and another 87,000 residents are in evacuation warning zones, meaning that a potential of nearly a quarter of a million residents could be displaced for weeks or months to come and will need temporary housing.

State Attorney General Rob Bonta announced at a press conference over the weekend that his office has received numerous reports of hotels and rental properties in southern California increasing their prices by more than 10%, which is illegal under state law.

"We should not be engaged in price gouging, whether it's groceries or rent," said Bonta. "We are very serious about this, and the governor's office, on ensuring that there is no price gouging and that anyone engaged in it is held accountable."

Gov. Gavin Newsom has issued a series of emergency orders to protect against price gouging by landlords, as well as illegal price increases by construction companies, storage services, building supply retailers and other essential businesses such as grocery stores. The order is effective until Jan. 7, 2026, but not everyone is complying with the law.

According to Newsweek, which looked through local listings researched by Southern California Public Radio's news outlet LAist, one property in Bel Air was listed on the Zillow real estate website for $29,500 per month as of Jan. 11. That is nearly double the $15,900 per month price listed for the property last September.

The Los Angeles Times reported that a property in Encino was listed on Zillow for $11,500 after the wildfires started, a $2,500 increase, or 27.7% price hike, from when it was listed at $9,000 as recently as Jan. 3. After the LA Times contacted the listing agent, the price was then lowered to $9,800, just below the 10% threshold, which made the price hike legal.

A real estate expert told the LA Times that the estimates for most single-family homes in the Los Angeles area show they are being listed for nearly 20% higher since the wildfires started.

"If those algorithms lead to prices higher after the declaration of emergency than before, by more than 10%, you're violating the law," said Bonta.

"You need to figure out how to adjust your prices consistent with the law," he continued. "If you're a mom-and-pop and you're not aware of these laws, you're now aware of these laws. Ignorance is not an excuse."

Under California law, violators who commit price gouging over the 10% threshold can receive up to one year in county jail or a fine of up to $10,000, or both.

"Bottom line, be on the lookout for illegally jacked up prices," said Bonta. "If you see something, if you know someone who's been the victim of price gouging, please report it to local authorities or my office right away."