HOA Rental Restrictions and AB 3182
Updated: May 8, 2021
Nullification of HOA rules against specified rental of units or accessory units.
What Is AB 3182?
AB 3182 was signed into law on September 28, 2020 and became effective on January 1, 2021. It added a new provision to the Davis-Stirling Act, Civil Code § 4741. It applies to owners in common interest developments (CIDs) and restricts HOAs from imposing “unreasonable” rental restrictions within the CID. The new law prohibits CC&R provisions that restrict rentals to less than 25% of the separate interests in the community. Further, HOAs may not prohibit or unreasonably restrict rentals of Accessory Dwelling Units (ADUs) or Junior Accessory Dwelling Units (JADUs) within the community. ADUs and JADUs may not be counted as separate interests for purposes of rental restrictions. Finally, AB 3182 modifies and streamlines municipal permitting requirements for installation and use of ADUs and JADUs.
How Does This Change Affect You?
AB 3182 does not impact an HOA’s ability to prohibit short term rentals of less than 30 days. The new law renders unenforceable other existing rental caps more restrictive than 25% of the total separate interests (not counting ADUs and JADUs) within the community. Associations have until December 31, 2021 to amend their CC&Rs and governing documents to comply with the new law. Associations who need to amend their CC&R documents to comply with the new law need to do so through the regular membership approval process. Presently, there is no “shortcut” provided in the statute to comply with this requirement. Associations attempting to enforce rental restrictions in violation of the law may be subject to civil penalties up to $1,000.
When Will New Rental Restrictions Be Enforced?
Despite the strong wording of AB 3182, the Legislature affirmed that new rental restrictions cannot be enforced against owners who purchased their property prior to the enactment of the new restrictions. Therefore, existing owners as of January 1, 2021 may be grandfathered in and exempt from AB 3182’s new rental restrictions. This is expected to give rise to significant disputes between grandfathered Association members and those who took ownership after January 1, 2021.
Contact us if you have questions regarding AB 3182, enforcement issues, or other matters relating to HOA governance. Your first consultation is always free and we look forward to understanding your unique goals and needs.