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    New California Real Estate Laws Impact South Bay

    January 18, 2024

    By: Richard Haynes

    As the South Bay home market remains in its winter slumber, I find January a great time to review new California laws going into effect in 2024 and how it might impact real estate.

    There are numerous new laws implemented every year from Sacramento and it is hard to keep track of them all. On today’s blog I will highlight new real estate laws and revisions to existing laws.

    Below are just a few of the new laws that pertain to real estate and beyond:

    1. Vacation Rentals: Right to Cancel Within 24 Hours (SB 644)
    2. Affordable Housing on Religious and Higher Education Lands (SB 4)
    3. Landlord/Tenant: Security Deposits Limited to One Month’s Rent (AB 12)
    4. Landlord/Tenant: Tenant Protection Act Revisions (SB 567)
    5. ADUs May be Sold Separately as a Condo (AB 1033)
    6. Flipper Disclosures for Properties Resold (AB 968)
    7. Residential Listings Capped AT 24 Months (AB 1345)

    Vacation Rentals: Right to Cancel Within 24 Hours (SB 644)

    Effective January 1, 2024, SB 644 requires that short-term rentals (or hosting platforms or third-party booking services) allow a consumer to cancel a reservation within 24 hours without penalty and the fund refunded to the original form of payment.

    This applies to rentals less than 30 days and if reservations were made at least 72 hours before the time of check-in. Courts are required to assess a civil penalty of up to $10,000 for each violation depending on the extent and severity of violations.

    Quick Thoughts: To be clear… This allows for the cancellation of short-term rentals less than 24 hours after BOOKING. I initially read it and thought one could cancel just 24 hours before their stay. So, while at first the new law seems like a big deal, it is not a huge deal for consumers or short-term operators.

    Affordable Housing on Religious and Higher Education Lands (SB 4)

    SB 4, dubbed “Yes in God’s Backyard,” allow places of worship and non-profit colleges to build affordable housing on their land. Since many faith-based and non-profit colleges are on land not zoned for housing, many experience massive challenges in rezoning their land to build homes.

    This bill streamlines permitting process that overrides local zoning restrictions, not to mention avoid CEQA (California Environmental Quality Act).

    Any organization building this type of streamlined affordable housing must maintain those as affordable homes for a minim of 55 years for rental properties and 45 years for properties that can be owned.

    The details in this bill are huge and I encourage you to do your own research.

    Quick Thoughts: There will be folks on both sides of this new law. Proponents will argue that it unlocks over 170,000 acres of land throughout the state to help with the housing crisis in California. Opponents will argue that local control is being revoked from cities and that unintended consequences to neighborhoods will happen without thoughtful input from residents and local stakeholders.

    Landlord/Tenant: Security Deposits Limited to One Month’s Rent (AB 12)

    Beginning July 1, 2024, California landlords will be limited to charging tenants a maximum of one month’s rent for a residential unit.

    I covered the details in my October Instagram Reel that received nearly half a million views. Watch it here for a summary of this new law.

    Landlord/Tenant : Tenant Protection Act Revisions (SB 567)

    Effective April 1, 2024, SB 567 will revise and tighten requirements for landlords to end a tenancy under the Tenant Protection Act in the follow situations:

    • No-fault eviction based on owner move-in.
    • No-fault eviction based on substantial remodeling.

    An owner who materially violate the TPA by improperly terminating a tenancy or raising rent beyond the maximum allowable is liable for:

    • Actual damages
    • Reasonable attorney’s fees and costs
    • Up to three times actual damages for willful violations
    • Punitive damages
    • The Attorney General, et al. is authorized to seek injunctive relief.

    The details of the law are long and dense. There is much more to this, the actual rules, etc., etc. so any landlord or tenant in the process of a no-fault eviction should seek the services of a qualified attorney.

    Quick Thoughts: Even more red tape for both tenants and landlords to navigate in California.

    ADUs May be Sold Separately as a Condo (AB 1033)

    AB 1033 grants local agencies authority to adopt an ordinance allowing for the separate conveyance of an ADU. Essentially, you can build an ADU on your property and resell it under this new law.

    That said, conditions do apply:

    1. Your city or local government must adopt an ordinance to permit this new law.
    2. The entire property must be transferred as a condominium complex and comply with condo laws.
    3. Lienholders must consent to the establishment of the condos.
    4. And finally, if the property is within an HOA, then that HOS must approve as well.

    Quick Thoughts: There will be so few localities that approve of this new legislation, but it will be interesting to see which ones do and how it affects the real estate market for the good, bad, or much ado about nothing.

    Flipper Disclosures for Properties Resold (AB 968)

    Effective July 1, 2024, seller of a residential one-to-four property who accept an offer within 18 months from the date when title was transferred must make the following disclosures:

    1. Disclose repairs and renovations with contracted contractors.
    2. Disclose the name of each contractor and their contact information.
    3. Disclose any permits obtained (or if not obtained, the contact of the party who can provide).

    If you work with an agent part of the California Association of Realtors, its disclosure package will be revised to aid in this proper disclosure via the Seller Property Questionnaire (and maybe even the Transfer Disclosure Statement).

    Quick Thoughts: In theory, this is redundant since California law already requires all material facts that could reasonably affect the value of a property be disclosed. That said, many owners, investors, and yes, even agents are unaware and very poor at disclosure. I believe this will help further disclosure between parties and ultimately a win for everyone, hopefully leading to fewer disputes and litigation.

    Residential Listings Capped at 24 Months (AB 1345)

    Previously, there was no specific limit to residential listing agreements on one-to-four properties. AB 1345 now caps a listing to 24 months.

    The law makes listings signed beyond 24 months unlawful, unenforceable, and void.

    There are additional details within the law to clarify timelines and with whom this applies to. One interesting detail is that an exclusive residential listing can be entered into with an LLC, corporation, or partnership, but it may nonetheless not be recorded or automatically renewed.

    Quick Thoughts: I think this is a great law to protect consumers from entering into long-term, and potentially damaging, listing contracts.


    There you have it! The most impactful new laws affecting real estate in 2024.

    While nothing here is a game changer, the security deposit change effective July 1st is something landlord will need to get used to. Additionally, I want to see how the for-sale ADU legislation works with the localities brave enough to take it on.

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