California’s new Positive Credit Reporting law, AB 2347, will reshape the rental landscape starting January 1, 2026. The law requires landlords who own 15 or more residential units to offer tenants the option to report on time rent payments to major credit bureaus. It is a simple change, but it can make a real difference for renters who want stronger credit scores and easier access to future housing or loans.
For tenants across the Bay Area from San Jose to Concord, this opens the door to real upward mobility. For landlords, it introduces a new compliance requirement that needs early planning.
Below is a clear breakdown of what this means, why it matters, and how it will impact local markets in Santa Clara County, San Mateo County, and Alameda County.
What AB 2347 Actually Requires
Beginning January 1, 2026, landlords with 15 or more units must:
• Offer tenants the option to opt in to rent reporting
• Report on time rent payments each month to at least one major credit bureau
• Provide written disclosure of the opt in program and any fees
• Keep records that show compliance
This rule applies to individual owners, LLCs, partnerships, and corporate landlords with 15 or more total units, not 15 units at a single property.
Read the full bill on the California Legislature site.
Why Tenants Should Care
On time rent payments can account for more than a third of a renter’s monthly financial activity, but most tenants get zero credit for it. AB 2347 corrects that.
Bay Area renters in competitive markets like Palo Alto, Sunnyvale, and Redwood City are often asked for high credit scores when applying for new leases. Consistent rent reporting can help tenants:
• Build credit faster
• Qualify for lower interest rates
• Strengthen future rental applications
• Recover more easily after past financial setbacks
For first time renters in San Jose, Hayward, or Oakland, this is especially valuable. Many young renters have limited credit history even when they always pay rent on time. AB 2347 turns their strongest financial habit into a real credit advantage.
What Landlords Need To Prepare For
Landlords in Menlo Park, Berkeley, Burlingame, and other high demand rental zones should prepare now for the new rule. Key steps include:
• Choose a rent reporting service that integrates with your existing property management system
• Update leasing documents to include the new opt in language
• Train staff to manage opt ins and changes
• Provide tenants a written explanation of the service and any costs
If landlords plan early, this transition can be smooth and cost effective. Waiting until late 2025 may make onboarding more stressful, especially for owners with large portfolios spread across cities like San Mateo, Daly City, and Concord.
Impact on Local Markets Across the Bay Area
San Jose and Santa Clara
Large multifamily operators dominate many neighborhoods. Expect high adoption rates since most buildings exceed the 15-unit threshold.
Sunnyvale, Palo Alto, and Menlo Park
These areas have many mid sized complexes. Tenants who work in tech may see stronger credit profiles, which helps when relocating or applying for mortgages.
Redwood City, San Mateo, and Burlingame
Tight competition for rentals means improved credit scores can give tenants an edge. Expect reporting to become a standard expectation.
Daly City, Hayward, Oakland, and Berkeley
These markets have more mixed ownership, including many large buildings. Renters who have struggled to rebuild credit may benefit most.
Concord
Many value focused rental communities fall within the 15 unit rule. This could boost credit growth for working families and long term renters.
