Housing Laws 2025: What You Need to Know

California's housing landscape is undergoing significant changes with the implementation of new housing laws effective July 1, 2025. These reforms aim to address the state's ongoing housing crisis by streamlining development processes, protecting tenants, and creating more affordable housing opportunities. Understanding these changes is crucial for investors, homeowners, and tenants alike as they navigate California's complex real estate market.

One of the most impactful changes is the CEQA streamline reform through AB-130 and SB-131. This reform exempts infill projects in urban areas from full California Environmental Quality Act (CEQA) environmental reviews, setting a 30-day deadline for approval of qualifying projects. For projects that narrowly miss exemption criteria, the review process will be limited to specific environmental impacts rather than comprehensive evaluations. This streamlining significantly reduces the bureaucratic hurdles that have historically delayed housing development throughout the state, potentially accelerating much-needed housing construction in California's urban centers.

The Builder's Remedy and ADU reforms represent another critical area of change. Through AB 2011 and SB 684, ministerial permitting has been expanded, offering a new 18-month entitlement extension and allowing the deferral of fees until occupancy. This extension is particularly beneficial for Accessory Dwelling Unit (ADU) projects, which have become increasingly popular as a solution to California's housing shortage. The additional six months beyond the standard 12-month timeline provides builders with breathing room to complete their projects without incurring penalties, especially when facing weather-related or other unforeseen delays.

For existing structures, new safety regulations have been implemented, including mandatory balcony inspections for buildings with three or more units. Following SB 721BA and SB 2579, the deadline for these inspections has been moved from January 2025 to January 2026. This requirement stems from serious safety incidents, including balcony collapses, making this reform a crucial public safety measure for multi-family residential buildings throughout the state.

The ADU amnesty program established by AB2533 extends forgiveness for unpermitted ADUs built before 2020, requiring local agencies to provide clear permitting pathways. This acknowledges the confusion that existed before 2020 when ADU regulations were still being formulated and permits were often difficult to obtain due to unclear guidelines. This amnesty program helps legitimize existing housing units while ensuring they meet basic safety requirements, effectively increasing the official housing supply without new construction.

Local zoning updates represent another significant shift, with cities like Berkeley and Cambridge now allowing duplexes, multiplexes, and middle housing by right, effectively ending single-family zoning restrictions in those areas. This change follows similar statewide reforms in California, creating more opportunities for diverse housing types and potentially increasing density in previously restricted neighborhoods. These reforms directly address exclusionary zoning practices that have contributed to housing shortages and affordability issues.

Tenant protections have also been strengthened under the new laws. SB 267 prohibits landlords from using credit history alone to determine eligibility for subsidized housing without alternative proof methods. This protection acknowledges that credit scores don't always reflect a person's reliability as a tenant, particularly for low-income individuals who may have experienced financial hardships beyond their control. Additionally, SB 1620 allows tenants with mobility-related disabilities to request accessible unit transfers at the same rent rate, preventing discrimination against those with disabilities and ensuring they don't face financial penalties for accessibility needs.

The state has also reinforced rent control with just-cause eviction protections in many jurisdictions, limiting arbitrary evictions in a state already facing severe housing shortages. These protections recognize that in California's tenant-focused legal environment, property owners cannot evict residents without legitimate cause, providing stability for renters in an increasingly challenging housing market.

At the federal level, the Affirmatively Furthering Fair Housing rule has been modified, allowing local jurisdictions more control over zoning without federal equity conditions. This change potentially gives communities more flexibility in addressing their specific housing needs without adhering to one-size-fits-all federal requirements. However, this deregulation raises questions about maintaining equity in housing access across different communities.