learninvestor toolkitsilicon valley rental property

The Silicon Valley investor toolkit

Run the numbers on a rental, time a 1031 exchange, and check the rent rules in each city before you buy. Every rule here is sourced; every assumption in the calculator is yours to change.

Cash flow calculator1031 clockRent rules by city

  • 1031 deadlines45 / 180 daysidentify / close, counted from the sale
  • depreciation27.5 yearsresidential rental buildings, straight-line
  • state rent cap5% + CPI10% a year at most (AB 1482)
  • property taxno exemptionrentals don’t get the homeowners’ exemption

cash flow

Rental cash flow

Put in the price, financing, rent and costs; get net operating income, cap rate, cash flow and return.

the numbers

    Depreciation here is the building share divided by 27.5 years, before the first-year mid-month convention. Ask a tax advisor how it applies to you.

    1031 clock

    1031 exchange clock

    Enter the day the property you’re selling closes to see both deadlines.

    your deadlines

      The 180-day deadline comes sooner if your tax return for the year of the sale (including extensions) is due first. Confirm every date with your qualified intermediary.

      1031 basics

      How a 1031 exchange works

      Defer the tax on a sale by rolling the proceeds into another investment property.

      • Real property onlySince 2018, only real property held for investment or business use qualifies.
      • Identify within 45 daysUp to three properties of any value, or more if their total value stays within 200% of what you sold; a 95% rule covers larger lists.
      • Close within 180 daysOr by your tax return due date for the year of the sale, if that comes first.
      • Keep the cash away from youA qualified intermediary holds the sale proceeds so you don’t receive them, the IRS safe harbor for a deferred exchange.
      • Boot is taxableCash or other property you receive in the exchange is taxed.
      • California keeps trackTrade California property for property outside the state and you file FTB Form 3840 every year until the deferred California gain is taxed.
      property nerd note

      The clock starts the day your sale closes, so line up a qualified intermediary and talk to your tax advisor before you list.

      rent rules

      Rent rules, state and city

      Which rules apply depends on the building’s age and type and the city it’s in. These were checked October 15, 2026; they change often.

      californiaTenant Protection Act (AB 1482)

      5% + CPI, 10% at most

      Covers most rentals statewide that are 15 years old or more.

      • Increases capped at 5% plus regional CPI, never more than 10% in 12 months; rent can reset between tenants
      • Just cause required once a tenant has been there 12 months; no-fault evictions require one month’s rent in relocation help
      • Exempt: housing built in the last 15 years, and single-family homes and condos not owned by a corporation or REIT if the tenant got the required written notice
      • Stricter owner move-in and substantial-remodel rules since April 1, 2024; the law expires January 1, 2030

      For August 1, 2026 to July 31, 2027, the state cap in the San Francisco area (including San Mateo County) is 8.8%, per the Attorney General.

      californiaCosta-Hawkins

      Limits on local rent control

      State law that sets the outer edge of what cities can cap.

      • Single-family homes and condos, and housing first occupied after February 1, 1995, are exempt from local rent caps
      • Owners can reset rent between tenants
      • Still in force: Proposition 33, which would have repealed it, failed in 2024

      citySan Jose

      5% a year for older apartments

      Apartment Rent Ordinance and Tenant Protection Ordinance.

      • Buildings of 3 or more units built before September 7, 1979: increases up to 5% once every 12 months
      • Just cause rules for buildings of 3 or more units
      • Transient occupancy tax rose from 10% to 12% on October 1, 2026

      cityMountain View

      2.5% through August 2027

      Community Stabilization and Fair Rent Act (CSFRA).

      • Covers apartments built before 1995 in full
      • Annual general adjustment of 2.5% for September 1, 2026 to August 31, 2027
      • A separate ordinance covers mobile home spaces

      cityEast Palo Alto

      2% through June 2027

      Rent stabilization ordinance.

      • Annual general adjustment of 2% for July 1, 2026 to June 30, 2027
      • Check the city’s applicability rules for your building

      citySan Francisco

      1.6% through February 2027

      Rent Ordinance.

      • Covers most multi-unit buildings built before June 13, 1979
      • Allowable increase of 1.6% for March 1, 2026 to February 28, 2027
      • Short-term rentals: primary residence only, up to 90 unhosted nights a year, registration required; 14% transient occupancy tax

      cityNo local cap, local protections

      Palo Alto, Redwood City, San Mateo, Menlo Park

      No city rent cap, but local tenant rules apply on top of state law.

      • Palo Alto: just cause after 6 months, relocation help and a rental registry; a rent cap was deferred in June 2026
      • Redwood City: just cause, relocation help and a one-year lease offer, from January 1, 2026
      • City of San Mateo: just cause after 11 months and one month of relocation help, adopted December 2025
      • Menlo Park: a tenant relocation ordinance, and an Anti-Displacement Plan from May 2026

      townLos Gatos

      Mediation, not a hard cap

      Rental Dispute Resolution Program.

      • Disputes over increases go through the Town’s mediation program
      • Check the Town’s current thresholds before a large increase

      more to know

      Owning and selling a rental

      • No homeowners’ exemptionRentals pay 1% plus local bonds, with Prop 13’s 2% yearly cap on assessed value, but no homeowners’ exemption.
      • Security depositsSince July 1, 2024, most landlords can collect no more than one month’s rent as a deposit.
      • Selling: California withholdingEscrow withholds 3⅓% of the price for the state, for residents and nonresidents, unless an exemption applies: a sale of $100,000 or less, a principal residence, or a sale at a loss.
      • Selling: FIRPTAWhen the seller is a foreign person, the buyer generally withholds 15% of the amount realized, with exceptions for some homes the buyer will live in.
      • DSCR loansSome lenders qualify investment loans on the property’s rent compared with its payment rather than on your income. Terms vary by lender.

      sources

      Where the rules come from

      Official sources, checked October 15, 2026.

      questions

      Questions we hear

      Is a rental in Silicon Valley under rent control?

      It depends on the building and the city. State law caps most rentals 15 years old or more at 5% plus CPI (10% at most), with exemptions, and San Jose, Mountain View, East Palo Alto and San Francisco add local rules for older multi-unit buildings. Under Costa-Hawkins, single-family homes, condos and newer buildings are exempt from local caps.

      When does the 1031 clock start?

      The day the property you sell closes. You have 45 days to identify replacement property and 180 days, or your tax return due date if earlier, to close on it.

      How is a rental depreciated?

      The building, not the land, is depreciated straight-line over 27.5 years from when it’s placed in service.

      What should I check before buying a rental?

      The building’s age and unit count (they decide which rent rules apply), the current rents and leases, the city’s tenant rules, and whether the numbers work at today’s rate. We’ll pull rents and comps for any property you’re considering.

      more to learn

      Keep going

      General information, not tax, legal or investment advice. Rent rules change often; check the city and state pages before setting rent or serving notice. Checked October 15, 2026.

      talk to a property nerd

      Looking at an investment property?

      We’ll pull rents, comps and the local rules for any property you’re considering, and run the numbers with you. Commissions are negotiable, and we offer bundled services, so ask us what’s included.

      Book a strategy callCall (408) 373-1660Call (650) 383-8606

      Looking at a rental? Send us a note.

      Eric & Janelle Boyenga

      Eric & Janelle Boyenga

      +1(408) 373-1660

      Agent DRE01254724 / 01254725

      Agent DRE01254724 / 01254725

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