Montgomery County Rent Cap 2026-2027: 5.2% Limit

Montgomery County's rent stabilization program sets the maximum allowable rent increase using a formula: the CPI-U for the Washington-Arlington-Alexandria area, plus 3 percentage points, capped at 6% regardless of how high CPI-U runs.

[Cite: Montgomery County DHCA, official rent stabilization notice, dated February 27, 2026]

For the 2026-2027 period, CPI-U measured 2.2%, which produced 2.2% plus 3%, or 5.2%, well under the 6% ceiling.

[Cite: Montgomery County DHCA, official rent stabilization notice, dated February 27, 2026]

The official notice setting this rate is dated February 27, 2026. A landlord expecting the announcement to land in March, based on how the prior year's figure was released, should note the timing shifted earlier for this cycle.

[Cite: Montgomery County DHCA, official rent stabilization notice, dated February 27, 2026]

That timing detail matters for planning purposes. A landlord who waits until March to check for the new rate risks missing weeks of lead time on a 90-day notice calculation.

This is the detail most likely to catch a landlord off guard. The mandatory rent stabilization cap only applies to units that have reached at least 23 years of age, with that age measured from the property's SDAT "Year Built" date, and a unit becomes regulated on the January 1st following the date it reaches that 23-year mark.

[Cite: Montgomery County DHCA, official rent stabilization page]

A landlord assuming their newer building falls outside rent stabilization because it's "too new" has the right instinct but the wrong threshold in mind if they're picturing a much younger cutoff. Twenty-three years is a meaningfully long window during which a building remains entirely outside the mandatory cap.

Properties younger than that 23-year threshold aren't simply unregulated with no guidance at all. A separate Voluntary Rent Guideline, set at 3.3% for 2026-2027, applies to these properties, along with qualifying small landlords owning 2 or fewer units.

[Cite: Mainstay Property Management, "Updated: Guide to Landlord Compliance in Montgomery County, MD"]

That guideline is voluntary in name for most exempt properties, but the county specifically makes it mandatory for MPDU (Moderately Priced Dwelling Unit) properties regardless of building age.

[Cite: Montgomery County DHCA, official rent stabilization notice, dated February 27, 2026]

Rental units located in Gaithersburg, Rockville, Takoma Park, Barnesville, and Laytonsville aren't subject to Montgomery County's rent stabilization program at all.

[Cite: Montgomery County DHCA, official rent stabilization page]

A landlord with a portfolio spanning both county-regulated areas and one of these five incorporated municipalities needs to track two entirely separate compliance frameworks, since these municipalities aren't simply following a modified version of the county's program; they're outside its jurisdiction altogether for this purpose.

A rent increase requires 90 days' written notice, delivered specifically by U.S. certified mail or in person with a signed, dated receipt. Email and online tenant portals don't satisfy this delivery requirement.

[Cite: Mainstay Property Management, "Updated: Guide to Landlord Compliance in Montgomery County, MD"]

The notice itself has to state the current rent amount, the proposed new rent, the precise percentage increase, and an explicit certification that the increase complies with the parameters set by the county's Office of Landlord-Tenant Affairs.

[Cite: Mainstay Property Management, "Updated: Guide to Landlord Compliance in Montgomery County, MD"]

Any calculation error or missing required disclosure voids the notice entirely, and the 90-day countdown resets from scratch once a corrected notice goes out.

[Cite: Mainstay Property Management, "Updated: Guide to Landlord Compliance in Montgomery County, MD"]

That reset mechanism means a landlord who sends a flawed notice close to their intended effective date can lose most or all of their planning buffer, not just face a delay proportional to the error itself.

Landlords can bank unused portions of an allowable increase for use in a future year, similar to mechanisms used in other jurisdictions' rent control programs. Regardless of banked capacity, total increases within any single 12-month period can't exceed 10%.

[Cite: Mainstay Property Management, "Updated: Guide to Landlord Compliance in Montgomery County, MD"]

That 10% figure functions the same way a hard ceiling does elsewhere: it caps how much banked plus current-year capacity can actually be applied at once, even for a landlord who has accumulated significant unused increase capacity over several years.

Civil penalties for a violation can reach up to $1,000 per violation, but the consequences extend beyond that figure. Noncompliance can also delay or result in denial of required licensing, and an improperly calculated or noticed rent adjustment can simply be invalidated outright.

[Cite: Mainstay Property Management, "Updated: Guide to Landlord Compliance in Montgomery County, MD"]

That invalidation piece matters independently of the fine itself. A landlord who implements a noncompliant increase risks having to unwind it, refund the difference, and restart the notice process, on top of whatever civil penalty applies.

Multifamily property owners have a distinct obligation from the rent-increase rules themselves: submitting the Annual Rental Survey through the DHCA Housing Portal between April 1 and April 30 each year, including unit-level rent history and any non-rent fees charged.

[Cite: Mainstay Property Management, "Updated: Guide to Landlord Compliance in Montgomery County, MD"]

Late submission carries its own penalty, also up to $1,000, separate from any penalty tied to the rent-increase notice requirements themselves.

[Cite: Mainstay Property Management, "Updated: Guide to Landlord Compliance in Montgomery County, MD"]

The maximum allowable increase has moved downward for three straight years: 6.0% for 2024 (the year CPI-U actually exceeded the formula's ceiling, since 3.3% plus 3% would have been 6.3%, so the flat 6% cap applied instead), 5.7% for 2025 (CPI-U of 2.7% plus 3%), and 5.2% for 2026 (CPI-U of 2.2% plus 3%).

[Cite: Montgomery County DHCA, Rent Stabilization Increases and Limitations page]

That trend line is worth knowing on its own terms. 2024 is the only one of these three years where the formula's flat 6% ceiling was actually the binding constraint rather than the CPI-U-plus-3% calculation; in both 2025 and 2026, the calculated figure came in under the ceiling and applied directly.

The underlying law, Bill 15-23, was approved by the County Council on July 18, 2023, and signed into law on July 25, 2023, following more than eight hours of council debate and roughly four months of competing rent control proposals being considered.

[Cite: Seyfarth Shaw LLP, "Montgomery County, Maryland Adopts 6% Cap on Rent Increases"]

A landlord newer to the county, or newer to owning regulated property there, should know this formula-based cap is a relatively recent framework, not a decades-old fixture, and it followed genuine legislative disagreement over how aggressive the county's rent control approach should be.

The practical starting point is checking each covered unit's actual age against the 23-year threshold, using the SDAT Year Built date, rather than assuming coverage status based on general impressions of how old or new a given building feels.

Building the 90-day notice timeline backward from any planned July 2026 increase, and confirming the notice delivery method meets the certified-mail or signed-receipt standard rather than relying on email or a tenant portal, closes the most common way this specific notice requirement gets invalidated.