Definition
A limit on the number or percentage of homes in a community that may be rented at one time.
A rental cap limits how many units in a community may be leased simultaneously, usually as a percentage of total homes. Communities use caps to preserve owner-occupancy, protect property values, and satisfy lender requirements for financing.
Rental caps are typically established in the CC&Rs, and adding or changing one often requires a membership vote. Administering a cap fairly — often with a waitlist — and knowing its interaction with lending rules takes careful management.