New Laws for 2021

New Laws for 2021

By: D. Keith Dunnagan, Esq.

January 5, 2021

Every year the state of California passes new laws and regulations that will impact nearly every segment of the market and 2020 was no different. While the big news maker during 2020 was COVID both the State and Feds passed legislation impacting the broader market. Today, we highlight some of the new laws that went into effect in 2020 and/or going into effect in 2021. Naturally, with the pandemic, there was a flurry of activity.

One of the major pieces of legislation to pass in California was SB 1079. This bill deals with changes related to the foreclosure process. A significant change that this bill creates is a right of first refusal for certain eligible bidders to buy a residential property through foreclosure. This law has the potential to significantly change non-judicial foreclosures for the foreseeable future. The law allows eligible bidders a 45-day window to bid on a residential property after the trustee sale. Needless to say it poses some significant changes to the foreclosure process and will likely slow down the time REOs can get to market post trustee sale.

As we addressed previously, Cal/OHSA passed emergency legislation related COVID and workplace safety. The regulation has a short shelf life unless further extended. This emergency regulation requires all businesses to have a COVID Prevention Plan, training for employees and potential reporting based upon certain occurrences.

AB 3088 was passed involving further eviction restrictions and moratoriums. Created new notices requirements and created additional protections for residential tenants during the COVID pandemic.

The theme has been COVID and until the vaccine rolls out broadly will likely continue that way. However, there was legislation that was not COVID related as well.

AB 3182 was signed into law impacting rental units governed by HOAs. A couple decades ago, there was a push by HOAs across the state to limit the number of rental units (tenant occupied units) by the CC&Rs. Lots of reasons were given for these restrictions, but a common reason was to maintain value of the units. A belief that rental units would depress the value of a condo/townhome. As a result, draconian covenants and restrictions began to appear in CC&Rs often limiting the number of allowed rental units to as little as 10% of the units. This made it difficult to rent out units. This new law prohibits such draconian limits. While HOAs can limit the number rental units in the association, that cap can now be no smaller than 25%. It also carved out ADUs.

Over the next few weeks, we will be breaking down many of these new laws that will impact real estate and business interests in California.

In the meantime – Happy New Year!

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