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New California Laws | 2019 Real Estate Update




Building Permits: Expiration period extended AB 2913 A building permit remains valid despite changes in the building code as long as work is commenced within 12 months after issuance. Effective 1-1-19


Building Permits: Issuance when original permit does not exist SB 1226 Requires the adoption of a building standard to authorize a local enforcement official to determine the date of construction of a residential unit, apply the building standards in effect at that date of construction, and issue a retroactive building permit when a record of the issuance of a building permit for the construction of an existing residential unit does not exist. Effective 1-1-19


Civil Liability: Liability of real estate agents for sexual harassment expanded SB 224 Even if a business, service, or professional “relationship” does not presently exist, a real estate agent (and “investor” among other persons) may be liable for sexual harassment when he or she holds himself or herself out as being able to help the plaintiff establish a business, service, or professional relationship with the defendant or a third party. This law eliminates the element that the plaintiff prove there is an inability by the plaintiff to easily terminate the relationship. Effective 1-1-19


Real Estate: New Private Transfer Fees Outlawed AB 3041 This C.A.R. sponsored law prohibits developers from creating new property covenants, conditions, or restrictions that force subsequent owners to pay specially designated fees every time the property is transferred, unless the fee provides a “direct benefit” to the property, as defined in federal law. Effective 1-1-19


Sexual Harassment: Liability for real estate agents expanded SB 224 Even if a business, service, or professional “relationship” does not presently exist, a real estate agent (and “investor” among other persons) may be liable for sexual harassment when he or she holds himself or herself out as being able to help the plaintiff establish a business, service, or professional relationship with the defendant or a third party. This law eliminates the element that the plaintiff must prove there is an inability by the plaintiff to easily terminate the relationship. Effective 1-1-19


Pest Reports: Certification and warranty SB 1481 This law requires a specified certification when the property is free of evidence of active infestation and requires all certifications to be included on the complete, limited, supplemental, or reinspection reports. Additionally, where a consumer has directly contracted for the fumigation, this law requires a Branch 1 registered company to also provide the certification of completion of the fumigation to the consumer who ordered the fumigation and would require the Branch 1 registered company to provide a warranty for fumigation to the owner or the owner’s designated agent. Effective 1-1-19


Homeowner Bill of Rights: Permanently restores the pre-2018 version SB 818 Homeowner Bill of Rights was originally enacted in 2012 (SB 900). However, many of its provisions expired on January 1, 2018. This new law (SB 818) permanently re-enacts those expired provisions. This summary first describes the original Homeowner Bill of Rights (HBOR), then the sunset provision effective in 2018, and then the reenactment of the original bill. Effective 1-1-19


Tax: Parcel Tax Exemption Notification for Senior and Disabled Property Owners AB 2458 This C.A.R. sponsored law creates a simple process for seniors or disabled homeowners to find information on how to apply for a parcel tax exemption. Effective 1-1-20


Home Inspectors: Irrigation system AB 2371 Authorizes a home inspection report on an in-ground landscape irrigation system to include information regarding the operation and observation of the irrigation system. Effective 1-1-19


Common Interest Developments: Financial review on a monthly basis and other anti-fraud precautions AB 2912 This law requires HOA boards to review on a monthly basis the association’s accounts and reserves; requires fidelity bond coverage for directors, officers, and employees to be maintained equal to three months’ reserves; and requires a manager to obtain written board approval before they may transfer association funds of $10,000 or more. Effective 1-1-19


Licensing: Applicant for a Real Estate license cannot be required to disclose citizenship or immigration status SB 695 This law prohibits a licensing board, including the DRE, from requiring an individual to disclose either citizenship status or immigration status for purposes of licensure, or from denying licensure to an otherwise qualified and eligible individual based solely on his or her citizenship status or immigration status. Effective1-1-19


Deeds: Revocable Transfer on Death Deed – FAQ Not Required to be Recorded AB 1739 The Revocable Transfer on Death Deed no longer requires the statutory FAQ to be recorded as part of the deed. Retroactively effective 1-1-16


Recording Fees: Exemption for Government Entities for Affordable Housing Recording Fee AB 110 Exempts government entities from the $75 Affordable Housing Recording Fee, including cities, counties or any other political subdivision of California. Effective 1-1-18


Real Estate Law Clean-up: Updates the real estate law to make it clearer and conform it to existing practice AB 1289 This C.A.R. sponsored “clean-up” legislation updates the real estate law to conform it to existing practice, eliminates antiquated or confusing laws, clarifies existing law, and introduces plain language where appropriate. Among the more important changes: This law reiterates that existing law permits agents and brokers to establish their working relationship as one of either independent contractor or employment: it consolidates real estate definitions across a range of laws; and it resolves a variety of specific issues caused by confusing and antiquated laws. Independent Contractor Relationship Reaffirmed. Effective 1-1-19


Landlord Tenant: Evictions – Three Days’ Notice Excludes Holidays and Weekends AB 2343 In counting a three days’ notice to pay rent or quit or a three days’ notice to perform covenant or quit, or in responding to a complaint for unlawful detainer, Saturdays, Sundays and judicial holidays are excluded. Effective 9-1-19


Landlord Tenant: Commercial Property - Disposal of Tenant’s Personal Property AB 2173 Increases the calculation of the total resale value of the personal property from $750 (or $1 per square foot, whichever is lesser) to either $2,500 or an amount equal to one month’s rent for the premises the tenant occupied, whichever is greater. Effective 1-1-19


Landlord Tenant: Service Member Protections AB 3212 Existing law allows a service member to terminate a lease of premises occupied for a residential, professional, business, agricultural, or similar purpose when that person entered a period of military service or receives deployment or change of status orders. This law additionally requires “any person,” such as a landlord or even potentially a property manager, who receives a good faith request from a service member and who believes the request is incomplete, not legally sufficient or that the service member is not entitled to the relief requested, to, within 30 days of the request, provide the service member with a written response acknowledging the request and setting forth the objections. If the person fails to make such a response the person waives any objection to the request, and the service member shall be entitled to the relief requested. Effective 1-1-19


Landlord Tenant: Inspection of Decks, Balconies, Stairways and Walkways SB 721 This law requires that buildings with 3 or more multifamily dwelling units with decks, balconies, stairways and walkways must be inspected by a properly licensed person by 2025, and a subsequent inspection must be done every 6 years. The owner would have to make repairs if the inspector found that the decks or balconies were in need of repair. Effective 1-1-19


Landlord Tenant: Law enforcement and emergency assistance AB 2413 Expands protections for victims of domestic violence and other types of abuse to not face eviction or other penalties on the basis of having summoned law enforcement or 9-1-1 emergency assistance on their own behalf, or on behalf of another, to respond to incidents of violence or abuse. Effective 1-1-19


Landlord Tenant: Price gouging and eviction during a declared emergency AB 1919 Retains the 10% maximum rental price increase during declared state of emergencies, and additionally:

• Expands the scope of criminal price gouging by including rental housing that was not on the market at the time of the proclamation or declaration of emergency.

• Clarifies that the cap on rent increases will remain in effect during an extension of a declared emergency.

• Makes it illegal to evict a tenant without cause during a state of emergency except for specified reasons if the property is then offered at a higher rent.

• Allows a greater than 10% rental price increase if directly attributable to additional costs for repairs or additions beyond normal maintenance that were amortized over the rental term.

Effective 1-1-19


Landlord Tenant: Rent – Requires landlord to accept rent from third parties AB 2219 Requires landlord to accept rent tendered by a third party. But no right of tenancy is created by acceptance, nor is a landlord required to accept housing assistance programs such as section 8. To ensure that no right of tenancy is created, the landlord may condition acceptance of rent from a third party on a signed acknowledgment to that effect. Effective 1-1-19


Landlord Tenant: Commercial Property Abandonment AB 2847 Allows a commercial landlord to serve Notice of Belief of Abandonment after the rent is unpaid for three days (at a minimum, depending on the number of days the lease requires before a landlord may declare a default), and allows delivery of that notice by overnight courier. This notice will expire after 15 days regardless of form of delivery. Effective 1-1-19


Landlord Tenant: Electric Vehicle Charging Stations AB 1796 Eliminates the rent control exemption for the requirement that a landlord permit installation of an Electric Vehicle Charging Station (EVCS). Effective 1-1-19


https://www.car.org/en/riskmanagement/qa/New-Laws/2019-New-Laws


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