“The forward motion [last] year was a reinforcement that we can make forward progress, that there are solutions, that we can make a difference,” she said. “We do not have to accept the status quo of the intensifying housing and homelessness crisis that our communities are experiencing across the state.”
The proposed funding comes amid a tough environment for builders, renters and home buyers alike as high interest rates and the struggling insurance market continue to drive up housing costs.
Home prices are expected to continue to grow at a roughly 6% pace in 2024, said Sanjay Wagle, head of government affairs for the California Association of Realtors. He said the supply of homes for sale will likely improve, but not enough to offset the corresponding increase in demand that is expected to be further boosted by decreasing mortgage rates.
Joshua Howard, with the California Apartment Association, said uncertainty in the job market could lead to uncertainty in the rental market. But, with mortgage rates still higher than they had been in the past, some would-be homebuyers will choose to continue renting.
“So, it’ll be an interesting 2024,” he said.
Here are some of the housing bills going into effect in 2024:
Housing Production
SB 4 (Wiener): The third year was the charm for the so-called “Yes in God’s Backyard” law. It allows 100% affordable housing developments to be built on land owned by religious institutions and nonprofit colleges or universities. It also exempts those projects from the California Environmental Quality Act and requires construction workers to be paid the prevailing wage. The Terner Center for Housing Innovation at UC Berkeley estimates 171,000 acres of developable land would be eligible to take advantage of the new law, which goes into effect on Jan. 1.
SB 423 (Wiener): In 2017, lawmakers passed SB 35 as one of more than a dozen landmark housing bills. The law, which was set to sunset in 2026, requires cities to approve certain housing projects that meet minimum affordable housing requirements if the city has not met its state-mandated housing targets. Another Terner Center report (PDF) credited the bill with adding some 18,000 housing units between 2018 and 2021. SB 423 extends the provisions of SB 35 through 2036.
SB 684 (Caballero): The law streamlines the approval process for small, infill apartment buildings with up to 10 units on vacant lots in neighborhoods where apartments are already allowed. It also includes protections against demolishing existing rent-controlled or affordable housing. The bill initially included single-family neighborhoods, which tend to be wealthier and whiter than neighborhoods with existing apartment buildings, but that provision was later removed. Adam Briones, CEO of California Community Builders, said the move “reinforces an unfortunate message that many people of color still feel is true: Our neighborhoods matter less to those in power than wealthy, white neighborhoods. This echo of California’s discriminatory past will unfortunately make it harder to build support for housing production in communities of color.” Matthew Lewis from California YIMBY said his organization would be lobbying for a new bill in 2024 to allow small apartment buildings in single-family neighborhoods.
Tenants’ Rights
AB 12 (Haney): Landlords in California have been allowed to charge two months’ rent as a security deposit for unfurnished apartments or homes and up to three months’ rent for furnished ones. AB 12 limits security deposits to one month’s rent, regardless of whether the residential property is furnished or unfurnished. It goes into effect on July 1, 2024.
SB 567 (Durazo): In 2019, California lawmakers passed the Tenant Protection Act, which was hailed at the time as one of the strongest laws of its kind in the nation. It capped rent increases at 10% in most rental properties that were built at least 15 years ago and imposed new eviction protections. Many tenant activists, however, felt it didn’t go far enough. SB 567 sought to strengthen the eviction protections in the 2019 law by limiting so-called “renovictions,” where landlords evict tenants to complete major repairs on the property. It also heightens the penalties for landlords who claim they are taking the property off the rental market only to re-rent the units, among other provisions. It goes into effect on April 1, 2024.
AB 1418 (McKinnor): The law aims for “crime-free housing” policies, which often require landlords to evict or otherwise penalize tenants if they have been arrested or had a criminal conviction or refuse to rent to them in the first place. The policies have been shown to impact people of color disproportionately. The new law does not stop landlords from performing background checks, only city policies that require them.
Environmental Restrictions Removed
AB 1449 (Alvarez): This law exempts 100% affordable housing projects from the California Environmental Quality Act, which can delay projects for years. Christopher Martin, policy director for Housing California, described it as one of the most impactful bills of the year. “It’s going to open up a lot more affordable housing,” he said. The law is scheduled to sunset in Jan. 2033.
AB 1307 (Wicks): The law makes clear that noise from students in university housing does not fall under the purview of the California Environmental Quality Act. It resulted from a California appeals court ruling in February that ruled it could. The case arose after a neighborhood group brought suit over UC Berkeley’s plan to construct housing for 1,100 students and more than 100 homeless residents at People’s Park.
AB 1633 (Ting): In 2021, the San Francisco Board of Supervisors failed to approve a 500-unit housing project atop a parking lot, claiming the project needed “further environmental study,” though it did not specify a clear direction for how to bring the project into compliance. AB 1633 clarifies that withholding clearance of a housing development that otherwise meets the requirements of the California Environmental Quality Act is a violation of state housing law.
ADUs
AB 976 (Ting): When accessory dwelling units, also known as casitas, granny flats or in-law units, were first legalized, many local governments required they only be built on properties where the owner also lived, a rule that stymied construction. A 2019 bill, AB 881, made it illegal to require owners to live on-site. That was set to sunset in 2025, but AB 976 makes it permanent.
AB 1033 (Ting): Under this new law, local governments can allow property owners to sell an accessory dwelling unit separately from the primary residence, essentially turning that casita into a condominium.
Other
ACA 1 (Aguiar-Curry): If voters approve this constitutional amendment in November, it would lower the threshold to approve bonds and special taxes for affordable housing and public infrastructure projects from a two-thirds supermajority to 55%. If it passes, any bonds on the same ballot would be approved under the new threshold.
The original version of this report contained inaccurate data. Assembly Bill 1532 (Haney) did not pass the Legislature. The story has been edited to correct the inaccuracy.
