New Laws and Regulations for 2022 – Part 2A (Real Estate Updates)
New Laws and Regulations for 2022 – Part 2A (Real Estate Updates)
By: D. Keith Dunnagan, Esq. and Trey Van Dyke (2L)
January 25, 2022
A couple of weeks ago we introduced our looking forward series and we’ve touched on a few things to look for in 2022. Today, we continue this series by looking at new laws and regulations that will be affecting real estate industry professionals and real estate consumers. We’ll group the laws into categories for easy reference back to this article, if necessary, but some of the laws could easily fit into multiple categories. These categories are Consumer Protection/Relief, DRE and Licensing, Housing Development, Landlord/Tenant, and Estate-Related.
Consumer Protection/Relief
Appraisal Discrimination Disclosure and Purchase Agreement Notice: AB 948.
Adds a statutory disclosure notice regarding discrimination in appraisals and requires that it is incorporated into real property purchase agreements. The notice is a part of Transfer Disclosure Statement Law and contains a cancellation right. The law has the following four significant changes that real estate professionals and consumers should pay particular attention to: 1) the law creates a simple form for filing a complaint regarding appraisal discrimination, 2) the law prohibits an appraiser from basing their valuation on several identity factors (including source of income, marital status, and military status, in addition to traditional protected classes) and any basis prohibited by the federal Fair Housing Act, and 3) the law requires the notice to be delivered by a licensed person, including a real estate broker or agent, and including those refinancing a mortgage on a 1-4 unit property. The statutory notice is required effective July 1, 2022, but all other aspects of the law are effective January 1, 2022.
Clarification of Prop 19 (55+ homeowner may be able to transfer tax value after fire): SB 539.
Proposition 19 implementing legislation clarifies the rules of exemptions from reassessment allowing for the portability of a homeowner’s tax basis everywhere in the state even if the value of the property is greater (with an adjustment upwards in such a case). Rules regarding intergenerational transfer of property or family farms from parent to child, are also addressed and clarified.
Discriminatory Restrictions in CC&R Disclosure and Modification: AB1466.
This law requires real estate brokers or agents, and others, with actual knowledge of discriminatory restrictions to notify the owner or buyer of those restrictions and to provide information for the removal process. It makes the process of redacting racially restrictive language easier and faster and creates a program for carrying out the redaction of unlawfully restrictive covenants.
Extension of Time for Disaster Property Tax Valuation Transfers: SB 303.
In regard to exemptions under Revenue and Tax Code (“RTC”) 69, this law extends by two years the time period for a taxpayer affected by a disaster declared by the Governor to transfer their base year value to a new residence when the deadline to transfer was after March 4, 2020, but on or before the COVID-19 emergency termination date, or March 4, 2022, and the property was damaged within the same time period. RTC 69 already allows a 5-year window to build a new structure. This law extends that timeline to seven years. It does not pertain to extensions regarding sales and new construction of replacement property under Proposition 19.
Fire Hazard Home Hardening and Defensible Space Expansion: SB 63.
The law extends home hardening and defensible space disclosures to high fire hazard zones within the local responsibility area. CalFire will now designate within local responsibility areas three zones: moderate, high, and very high fire hazard zones as opposed to just very high fire hazard zones. The Natural Hazard Disclosure (NHD) only discloses two fire related zones. As a result, the NHD can no longer be relied upon to indicate whether a property is subject to home hardening disclosures and defensible space compliance. Agents and brokers should consult with their NHD representative for further guidance if operating in areas that could be potentially covered by these changes.
HOA Electronic Communication: SB 392.
This one is pretty simple. It requires HOAs to communicate with homeowners via email, if that is the homeowner’s preferred method of communication. Previous laws forced delivery of documents through the HOAs preference of communication, which was often hard copy documents. The aim is to reduce costs and environmental impacts.
Owner Occupant Foreclosure Loophole Closed: AB 175.
Legislation last year was passed that created a category of priority bidders at foreclosure sales of residential 1–4-unit properties. The highest priority bidder was “owner occupant,” but excluded from this category were the mortgagor, or relatives of the mortgagor. The law aims to close this loophole that could allow a conflict of interest to obtain a priority bid.
PACE Loans and Seniors: AB 790.
This law clarifies that relief under the Consumer Legal Remedies Act (CLRA) is available for seniors who have fallen victim to predatory Property Assessed Clean Energy (PACE) loans via home solicitations. It provides much needed clarity of seniors’ rights in this regard and prevents PACE lenders from using technicalities to evade their obligations when a senior whose home has been put at risk because of a PACE loan seeks relief under the CLRA.
Sewer Inspectors May Perform Sewer Lateral Repairs: SB 484.
Plumbers that are inspecting a home’s sewer lateral connection to a sewer system may also perform repairs if the consumer is provided a specific disclosure before authorizing the home inspection. Previously, the law made it an unfair business practice for the same company to perform an inspection and then charge for the repairs in certain fields, including but not limited to plumbing.
Tax Collection Late Payments may be Cancelled During Stay-at-home Order: SB 219.
A Tax Collector may cancel property tax late payment penalties if due to a shelter in place order, if the principal payment for the proper amount of tax due is paid no later than June 30 of the fiscal year in which the payment first became delinquent.
We will continue with our real estate updates over the next couple of weeks.
The attorneys at BPE Law have a long history working with landlords, property managers and real estate investors on their real estate needs. If you or someone you know has questions related to their real estate holdings, BPE’s attorneys are here to help you navigate the complex web of statutes and regulations related real estate.
The information presented in this Article is not to be taken as legal advice. Every person’s situation is different. If you are facing a legal issue of any kind, get competent legal advice in your State immediately so that you can determine your best options.
Recent and Popular Articles From Our Blog:
2020 Blogs:
- April 28 – A New Reality – Temporary or Permanent – Virtual Showings and Disclosures
- May 22 – Servant Leadership
- June 8 – Paycheck Protection Program Flexibility Act is Enacted
- June 10 – Impact to Credit Score After Filing Chapter 7 Bankruptcy
- June 26 – SBA Rolls Out Updated PPP Loan Forgiveness Application
- July 2 – Understanding the Home Equity Sales Contract Act 2020
- July 14 – Governor Rolls Back Re-Opening
- August 4 – August 2020 COVID-19 Update
- August 18 – Status Of Selected California State Operations re: COVID-19
- September 1 – COVID Update on Foreclosures and Evictions
- September 3 – State Passes AB 3088
- September 15 – Update on PPP Forgiveness and Impacts
- November 10 – Changes to the Fair Housing and Discrimination Advisory CAR Form
- November 24 – In a Season of Difficulty – We Choose Gratitude
- December 15 – Cal/OSHA Issues New COVID Prevention Rule
2021 Blogs:
- January 5 – Introduction to New Laws 2021
- January 26- Rain and the Prevalence of Failure to Disclose Claims
- February 2 – California Enacts COVID Tenant Relief Act (SB 91)
- March 9 – Understanding the Trust Exception to Real Estate Disclosures
- April 20 – Cash for Keys and SB 91
- May 4 – Help! Tenant Won’t Cooperate with Sale of Home
- May 11 – California Passes AB 80
- June 15 – Pinhole Leaks in Copper Pipes in Folsom
New Laws and Regulations for 2022 – Part 2A (Real Estate Updates)
By: D. Keith Dunnagan, Esq. and Trey Van Dyke (2L)
January 25, 2022
A couple of weeks ago we introduced our looking forward series and we’ve touched on a few things to look for in 2022. Today, we continue this series by looking at new laws and regulations that will be affecting real estate industry professionals and real estate consumers. We’ll group the laws into categories for easy reference back to this article, if necessary, but some of the laws could easily fit into multiple categories. These categories are Consumer Protection/Relief, DRE and Licensing, Housing Development, Landlord/Tenant, and Estate-Related.
Consumer Protection/Relief
Appraisal Discrimination Disclosure and Purchase Agreement Notice: AB 948.
Adds a statutory disclosure notice regarding discrimination in appraisals and requires that it is incorporated into real property purchase agreements. The notice is a part of Transfer Disclosure Statement Law and contains a cancellation right. The law has the following four significant changes that real estate professionals and consumers should pay particular attention to: 1) the law creates a simple form for filing a complaint regarding appraisal discrimination, 2) the law prohibits an appraiser from basing their valuation on several identity factors (including source of income, marital status, and military status, in addition to traditional protected classes) and any basis prohibited by the federal Fair Housing Act, and 3) the law requires the notice to be delivered by a licensed person, including a real estate broker or agent, and including those refinancing a mortgage on a 1-4 unit property. The statutory notice is required effective July 1, 2022, but all other aspects of the law are effective January 1, 2022.
Clarification of Prop 19 (55+ homeowner may be able to transfer tax value after fire): SB 539.
Proposition 19 implementing legislation clarifies the rules of exemptions from reassessment allowing for the portability of a homeowner’s tax basis everywhere in the state even if the value of the property is greater (with an adjustment upwards in such a case). Rules regarding intergenerational transfer of property or family farms from parent to child, are also addressed and clarified.
Discriminatory Restrictions in CC&R Disclosure and Modification: AB1466.
This law requires real estate brokers or agents, and others, with actual knowledge of discriminatory restrictions to notify the owner or buyer of those restrictions and to provide information for the removal process. It makes the process of redacting racially restrictive language easier and faster and creates a program for carrying out the redaction of unlawfully restrictive covenants.
Extension of Time for Disaster Property Tax Valuation Transfers: SB 303.
In regard to exemptions under Revenue and Tax Code (“RTC”) 69, this law extends by two years the time period for a taxpayer affected by a disaster declared by the Governor to transfer their base year value to a new residence when the deadline to transfer was after March 4, 2020, but on or before the COVID-19 emergency termination date, or March 4, 2022, and the property was damaged within the same time period. RTC 69 already allows a 5-year window to build a new structure. This law extends that timeline to seven years. It does not pertain to extensions regarding sales and new construction of replacement property under Proposition 19.
Fire Hazard Home Hardening and Defensible Space Expansion: SB 63.
The law extends home hardening and defensible space disclosures to high fire hazard zones within the local responsibility area. CalFire will now designate within local responsibility areas three zones: moderate, high, and very high fire hazard zones as opposed to just very high fire hazard zones. The Natural Hazard Disclosure (NHD) only discloses two fire related zones. As a result, the NHD can no longer be relied upon to indicate whether a property is subject to home hardening disclosures and defensible space compliance. Agents and brokers should consult with their NHD representative for further guidance if operating in areas that could be potentially covered by these changes.
HOA Electronic Communication: SB 392.
This one is pretty simple. It requires HOAs to communicate with homeowners via email, if that is the homeowner’s preferred method of communication. Previous laws forced delivery of documents through the HOAs preference of communication, which was often hard copy documents. The aim is to reduce costs and environmental impacts.
Owner Occupant Foreclosure Loophole Closed: AB 175.
Legislation last year was passed that created a category of priority bidders at foreclosure sales of residential 1–4-unit properties. The highest priority bidder was “owner occupant,” but excluded from this category were the mortgagor, or relatives of the mortgagor. The law aims to close this loophole that could allow a conflict of interest to obtain a priority bid.
PACE Loans and Seniors: AB 790.
This law clarifies that relief under the Consumer Legal Remedies Act (CLRA) is available for seniors who have fallen victim to predatory Property Assessed Clean Energy (PACE) loans via home solicitations. It provides much needed clarity of seniors’ rights in this regard and prevents PACE lenders from using technicalities to evade their obligations when a senior whose home has been put at risk because of a PACE loan seeks relief under the CLRA.
Sewer Inspectors May Perform Sewer Lateral Repairs: SB 484.
Plumbers that are inspecting a home’s sewer lateral connection to a sewer system may also perform repairs if the consumer is provided a specific disclosure before authorizing the home inspection. Previously, the law made it an unfair business practice for the same company to perform an inspection and then charge for the repairs in certain fields, including but not limited to plumbing.
Tax Collection Late Payments may be Cancelled During Stay-at-home Order: SB 219.
A Tax Collector may cancel property tax late payment penalties if due to a shelter in place order, if the principal payment for the proper amount of tax due is paid no later than June 30 of the fiscal year in which the payment first became delinquent.
We will continue with our real estate updates over the next couple of weeks.
The attorneys at BPE Law have a long history working with landlords, property managers and real estate investors on their real estate needs. If you or someone you know has questions related to their real estate holdings, BPE’s attorneys are here to help you navigate the complex web of statutes and regulations related real estate.
The information presented in this Article is not to be taken as legal advice. Every person’s situation is different. If you are facing a legal issue of any kind, get competent legal advice in your State immediately so that you can determine your best options.
Recent and Popular Articles From Our Blog:
2020 Blogs:
- April 28 – A New Reality – Temporary or Permanent – Virtual Showings and Disclosures
- May 22 – Servant Leadership
- June 8 – Paycheck Protection Program Flexibility Act is Enacted
- June 10 – Impact to Credit Score After Filing Chapter 7 Bankruptcy
- June 26 – SBA Rolls Out Updated PPP Loan Forgiveness Application
- July 2 – Understanding the Home Equity Sales Contract Act 2020
- July 14 – Governor Rolls Back Re-Opening
- August 4 – August 2020 COVID-19 Update
- August 18 – Status Of Selected California State Operations re: COVID-19
- September 1 – COVID Update on Foreclosures and Evictions
- September 3 – State Passes AB 3088
- September 15 – Update on PPP Forgiveness and Impacts
- November 10 – Changes to the Fair Housing and Discrimination Advisory CAR Form
- November 24 – In a Season of Difficulty – We Choose Gratitude
- December 15 – Cal/OSHA Issues New COVID Prevention Rule
2021 Blogs:
- January 5 – Introduction to New Laws 2021
- January 26- Rain and the Prevalence of Failure to Disclose Claims
- February 2 – California Enacts COVID Tenant Relief Act (SB 91)
- March 9 – Understanding the Trust Exception to Real Estate Disclosures
- April 20 – Cash for Keys and SB 91
- May 4 – Help! Tenant Won’t Cooperate with Sale of Home
- May 11 – California Passes AB 80
- June 15 – Pinhole Leaks in Copper Pipes in Folsom