The maximum increase is the lesser of 3% or 60% of the most recent CPI. As a general rule of thumb, if the CPI is 5% or higher, the maximum rent increase is 3% of current rent. However, if CPI is lower than 5%, then the maximum increase amount is 60% of CPI. Staff is available to answer questions about the current maximum increase and the resulting increase amount in dollars when applied to a particular current rent amount. An explanation of how to calculate these numbers yourself is below.
Using the example above, one way to calculate 60% of 5.7% (the most recent 12-month percent change in the example table) is to remove the percent signs and divide each number by 100 (60/100 = .6 and 5.7/100 = .057), and multiply those numbers together (.6 x .057 = .0342).
To turn this decimal number into a percent number, multiply the number by 100 and add a percent sign (3.42%). Since 3.42% is higher than 3%, the maximum rent increase would be 3%.
To calculate the maximum increase of the current amount, turn 3% into a decimal number by dividing it by 100 (3/100 = .03), and multiply this number by the amount of current rent. For example, if current rent is $2,000 per month, the maximum increase amount would be $60 (2,000 x .03 = 60). This would mean the amount of the increased rent could not exceed $2,060 per month for the next twelve months.
Some calculators, such as the calculator on an iPhone, have a button with the % sign. Typing in a percent number and tapping the % button will convert the number into a decimal number. There are also website calculators that may be useful in calculating 60% of CPI and the maximum increase amount for a particular current rent amount.