2026 California Real Estate Laws: What Buyers, Sellers, and Investors Need to Know

As California real estate law continues to evolve, so do the rules governing how properties are bought, sold, financed, rebuilt, and marketed. Heading into 2026, a wide range of new laws will impact buyers, sellers, investors, landlords, and the professionals guiding transactions from contract to close.

Below is a practical, plain‑English overview of the 2026 updates that matter most — with a focus on how they may show up in real‑world transactions.

2026 ADU and JADU Law Changes in California

California continues to push for increased housing supply, particularly through Accessory Dwelling Units (ADUs) and Junior ADUs (JADUs).

What changed:

• Owner‑occupancy requirements for JADUs now apply only when sanitation facilities are shared

• ADU and JADU size definitions now focus on interior livable space

• Local agencies must process ADU and JADU permits ministerially, with firm approval timelines

• Impact fees are limited or eliminated for smaller units

• Private plan review is permitted if local agencies exceed review timelines

Why it matters:
Expect increased ADU activity, fewer local delays, and more frequent title and zoning questions related to compliance, use restrictions, and permitted improvements.

HOA, CC&R, and Rebuilding Laws After Declared Disasters

Several new laws limit the enforceability of recorded restrictions that previously delayed rebuilding or redevelopment.

Key updates:

• HOAs and CC&Rs may not prohibit substantially similar reconstruction following a declared disaster

• Rebuild applications are subject to streamlined, ministerial approval timelines

• Restrictions that block affordable housing or qualifying residential redevelopment may be void and unenforceable

Why it matters:
Not every restriction recorded in public records remains legally enforceable. Covenants must now be evaluated in light of current state law, particularly in post‑disaster or redevelopment scenarios.

Wildfire-Related Real Estate Laws and Consumer Protections

In response to recent wildfire events, California enacted strong protections for homeowners and borrowers.

Unsolicited Offer Restrictions (AB 851)

• Buyers may not make unsolicited offers in designated fire‑affected ZIP codes

• Buyer and seller must sign and record a compliance attestation with the deed

• Sellers retain cancellation rights

• Violations carry significant penalties

Mortgage Forbearance (AB 238)

• Eligible homeowners may request up to 12 months of forbearance

• No late fees, default interest, or foreclosure activity during the forbearance period

• Credit reporting protections apply

Why it matters:
These laws directly affect transaction timing, documentation, and compliance. Title and escrow review play a critical role in ensuring these requirements are satisfied prior to closing.

Foreclosure, Lending, and Mortgage Servicing Law Updates

Mortgage servicers now face additional requirements before initiating foreclosure on certain subordinate liens.

What changed:

• Servicers must record a certification of compliance when recording a Notice of Default

• Certain unlawful servicing practices must be disclosed

• Sales to bona fide purchasers remain protected

Why it matters:
This adds another compliance layer to foreclosure‑related transactions while preserving market certainty for buyers.

Recorder Notification Programs and Real Estate Fraud Prevention

Every California county — with limited exceptions — must now implement a Recorder Notification Program.

What this means:

• Property owners are notified when deeds or deeds of trust are recorded

• Counties may offer electronic alerts in addition to mailed notices

• A small recording fee may apply

Why it matters:
These programs help detect fraud early and protect property owners from unauthorized recordings. Owners should confirm their mailing address on record and opt into electronic alerts where available.

Balcony Inspection and HOA Disclosure Requirements

Expanded inspection and disclosure requirements now apply to exterior elevated elements.

Key points:

• Applies to buildings with three or more attached units

• Inspections are required every six years

• Sellers must provide the most recent inspection report to buyers

• Reports must identify any immediate safety concerns

Why it matters:
These inspection reports are now part of standard transaction disclosures and may impact negotiations, timelines, and buyer due diligence.

Real Estate Marketing, AI Disclosure, and Privacy Laws

Several new laws affect how properties are marketed and how information is disclosed.

Notable updates include:

• Digitally altered or AI‑enhanced marketing images must be disclosed, with access to original unaltered images

• Certain pricing algorithms that restrain trade or coordinate pricing are prohibited

• Real estate licensee email addresses are no longer public records

Why it matters:
Marketing practices, data use, and disclosures are receiving increased regulatory scrutiny. Compliance now extends beyond contracts and into advertising and communication practices.

Insurance, Rental, and Tenant Law Updates for 2026

Additional laws impact insurance proceeds, rental habitability, and tenant protections.

Highlights:

• Lenders must pay interest on insurance proceeds held after property damage

• FAIR Plan coverage expanded for manufactured and mobile homes

• Rental properties must meet updated habitability standards, including appliance requirements

• New rules address disaster‑related lodging, remediation duties, and tenant protections

Why it matters:
These changes affect investors, landlords, and owners navigating repairs, insurance claims, and rental compliance.

What These 2026 California Real Estate Laws Mean for You

California’s 2026 real estate laws reflect a continued emphasis on consumer protection, housing access, transparency, and post‑disaster recovery. While these changes create new opportunities, they also add complexity to transactions and reinforce the importance of informed guidance and careful review at every stage.

If you have questions about how any of these updates may affect a specific property or transaction, I’m always happy to walk through the details.