customer looking at the sign that has very high prices for gas

Price Gouging

When businesses raise their prices too much during and after an emergency, it may be considered price gouging, a crime in California.

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Price Gouging

Living in Los Angeles County means you might one day face disasters like fires, floods, or earthquakes. Sometimes, during these emergencies, businesses and landlords will dramatically raise their prices to make extra profit. This is called price gouging and it’s illegal in California.

when disaster strikes don't get overcharged

When Are Price Gouging Rules In Effect?

If the Federal, State or Local Government (including the President, Governor, Mayor, or County Board of Supervisors) declares a state of emergency or a local emergency, businesses owners and landlords cannot increase prices by more than ten percent (10%) for consumers impacted by an emergency for the following items:

  • rent
  • food
  • repairs
  • construction
  • emergency and medical supplies
  • gasoline
  • storage facilities
  • hotels and motels
  • rental housing
  • short term rentals
  • animal boarding facilities
  • and other lodging

What are the Penalties for Price Gouging

Business owners in Los Angeles County must stay in compliance with state and Los Angeles County laws which protect consumers from price gouging. Price gouging during a state of emergency is illegal.  Failure to comply with the California Price Gouging Law (Penal Code 396) can result in fines up to $10,000 or one year in jail, or both.

How Long Do Protections Last?

Price gouging protections will remain in effect for 30 days after a declared emergency and can be renewed. Price-gouging protections for any contractor-related services are in effect for 180 days.  (For tips on hiring a contractor, see our tip sheet.)

What is Rental Housing Price Gouging?

After a declared emergency, renters are protected from rental housing price gouging and unfair rent hikes. Both state law (Penal Code Section 396) and the County Code (Chapter 8.09) prohibit rental housing price increases exceeding 10% during a declared state of emergency.

Rent Increase Rules

  • New and Existing Rentals: Landlords cannot increase rental housing prices by more than 10% of the previously charged price or advertised price following a declaration of emergency. For rental housing not previously rented or advertised, the price cannot exceed 160% of the fair market value established by the U.S. Department of Housing and Urban Development.
  • Daily Rentals: For daily rental housing like VRBO or Airbnb listings, the daily price cannot be increased by more than 10% following the declaration of an emergency. If these properties were previously rented on a daily basis and switch to full-time or monthly rentals after the declaration, the rental price cannot exceed 160% of the fair market value established by the US Department of Housing and Urban Development.

Prohibited Practices

  • A landlord cannot justify an unlawful price increase by offering additional services like gardening, cleaning, or utilities, or by offering a shorter lease term.
  • Landlords cannot charge a higher rate simply because an insurance company is willing to pay it.
  • The law considers it a separate misdemeanor for a landlord to evict a tenant and re-rent the property at a rate prohibited by anti-price gouging statutes.

How to Report Price Gouging

If you believe you have been improperly overcharged for goods, services, or housing, keep your records and receipts. Here’s how to file a price gouging complaint:

Current or prospective renters who believe they have been victims of rental housing price gouging should also report it to the California Attorney General at oag.ca.gov/report.

For more information about price gouging and other common consumer issues after a disaster, visit dcba.lacounty.gov/disasterready

Protections for Businesses

Businesses can only raise prices more than 10% in an emergency area if they can show that the increase is due to price increases from their suppliers.

If you are a business owner and believe your price increase is justified, keep complete records of your transactions as proof.

More Information

For additional information about scams during and after an emergency, read our After the Disaster news article.

California Penal Code 396

L.A. County’s Price Gouging Ordinance

 

County of Los Angeles Department of Consumer and Business Affairs. Last change: 1/13/2025

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