2026 California Real Estate Law Updates Every Buyer, Seller & Agent Must Know
- Ben Aurthar
- 2 days ago
- 3 min read
As we head into 2026, several new California laws are reshaping how real estate professionals market properties, disclose information, manage HOAs, and conduct transactions. These updates affect pricing practices, advertising, disclosures, inspections, fire-affected properties, and anti-money laundering compliance.
Below is a clear breakdown of the most important California real estate laws taking effect in 2026, what they mean, and how they impact buyers, sellers, agents, HOAs, and investors.
Cartwright Act Update, Pricing Algorithms Restricted.
Bill ID: AB-325
What’s changing: This law prohibits the use of shared or coordinated pricing algorithms that could restrain trade or coerce pricing behavior.
Why it matters:
Affects brokerages, platforms, and services using automated pricing tools.
Prevents price-fixing through AI or shared software.
Reinforces fair competition in housing markets.
Who should pay attention: Brokerages, MLS providers, prop-tech companies, and real estate investors.
AI & Digitally Altered Images, Disclosure Required.
Bill ID: AB-723
What’s changing: Any AI-generated or digitally altered image used in a real estate advertisement must include a disclosure, placed immediately adjacent to the image.
Why it matters:
Prevents misleading marketing.
Applies to MLS listings, websites, social media, and ads.
Virtual staging and enhanced photos must be labeled.
Pro tip: If you use virtual staging or AI image enhancements, add a visible note such as “Image digitally altered”.
Housing, Balcony Inspections & HOA Deadlines.
Bill ID: AB-130
What’s changing:
Properties with asbestos-containing balconies receive a 9-month extension for abatement.
After abatement, HOAs have 3 months to complete inspections.
Why it matters:
Impacts HOA timelines and compliance costs.
Affects condo sales and disclosures.
Reduces immediate penalties while maintaining safety standards.
Fire-Affected Properties, Unsolicited Offers Prohibited.
Bill ID: AB-851
What’s changing: Unsolicited offers are prohibited on residential properties located in Los Angeles and Ventura County fire-affected ZIP codes until January 1, 2027.
Why it matters:
Protects homeowners after wildfire disasters.
Investors and wholesalers must avoid outreach in restricted zones.
Violations may carry significant penalties.
Defensible Space, New Ember-Resistant “Zone 0”.
Bill ID: AB-1455
What’s changing: Creates Zone 0, an ember-resistant area within 5 feet of a structure, with new landscaping and material restrictions.
Why it matters:
Impacts sellers in wildfire-prone areas.
May affect insurance eligibility.
Buyers should verify compliance before closing.
HOA Balcony Inspection Reports, New Disclosure Requirement.
Bill ID: SB-410
What’s changing: HOAs must now include the most recent balcony inspection report in the standard HOA disclosure package.
Why it matters:
Increased transparency for buyers.
May influence negotiations and repairs.
Reduces surprise assessments post-closing.
Thirdhand Smoke Disclosure Now Required.
Bill ID: AB-455
What’s changing: Sellers must disclose known tobacco or nicotine residue or a history of smoking on the property.
Why it matters:
Goes beyond visible damage or odor.
Applies even if smoking occurred in the past.
Protects buyers with health sensitivities.
Anti-Money Laundering, New FinCEN Reporting Rule.
What’s changing: Title and escrow companies must report transactions to FinCEN when:
Property is 1–4 unit residential.
Purchase is all-cash.
Buyer is a legal entity or trust.
Why it matters:
Targets money laundering in real estate.
Increased documentation requirements.
Investors and trusts should plan ahead.
Private Permitting Review Allowed.
Bill ID: AB-253
What’s changing: Allows privately hired plan reviewers to conduct plan checks if a city or county exceeds 30 days.
Why it matters:
Speeds up development and renovations.
Reduces permit delays.
Helpful for builders, investors, and developers.
Final Thoughts.
California’s 2026 real estate laws emphasize consumer protection, transparency, safety, and compliance. Whether you’re a buyer, seller, agent, HOA board member, or investor, staying informed helps you avoid penalties and make smarter decisions.