Legislative laws are the boundaries within which everyone has to work by. In legislation that took effect on January 1, 2021, California tackled housing market issues such as residential density bonus, project streamlining and planning, Covid 19, and CEQA Act.

The state is also revising some laws that have previously failed to pass, such as the SB 9 that, if passed, would allow duplexes and single-family lots split into residential areas to be owned by right.¹

California Housing Legislation 2021 That Gained Effect as of 1st January 2021

Covid -19 Emergency Relief Response

Through the Assembly Bill, 3088 dabbed Covid -19 Emergency Relief Bill protects tenants who defaulted their rent between September 1, 2020, and January 31, 2021, from eviction as long as they can raise at least 25% of the rent payable. Hopefully, the landlord can recover the rest of the rent balance, which a tenant can clear in installments. A landlord cannot use the default of rent within that period as a reason for eviction.

Another Covid-19 response bill is the Housing Entitlement Extension that extends for a period of 18 months residential entitlements. The extension is to cover residents from the economic effects brought by Covid-19. Accordingly, the extension applies to all the entitlements that came into effect on March 4, 2020, and those that expired on December 31, 2020.  

The California housing legislation 2021 also protects landlords who are at risk of foreclosure. Thus, a mortgage company or a service agent will need to provide a written explanation for mortgage forbearance denial resulting from Covid-19 financial difficulties.

The Density Bonus Law

This law also took effect on January 1, 2021, revised provisions for offering additional gains towards affordable housing. The Density Law now gives beneficial rights to multifamily projects in affordable housing unit jurisdictions. The amended laws include:-

  • Eligibility: A qualifying project of up to 80% or an unlimited density bonus, all (100%) of the units must be affordable to low-income households. Providing that 20% of those units can be afforded by medium-income households.
  • Density Bonus: The assembly increased the density bonus from 35% to 50%. The projects eligible for very low-income Below Market Rate (BMR)., low-income BMR, and medium-income BMR.

Better Housing Experience

Together with other real estate laws passed in 2020, the laws aim to make housing more affordable by offering a bit of relief from financial strains from the effects of Covid-19. The laws also seek to make buying and selling homes smoother and tackle California’s housing market issues.

How the California Housing Legislation 2021 Helps With its Housing Struggles

The California housing market is struggling to provide its residents with affordable housing. Although the solution is the construction of more houses, the Covid-19 pandemic slowed down the process significantly. For the last half of 2020, the starts for both single-family dwelling and multi-dwelling homes fell below the intended construction capacity. For the better part of 2020, construction stalled, adding to delays that had begun in 2019. Hopefully, some of the legislation passed will help speed up the much-needed construction 


“About Mountain West Financial and the CalPATH Home Loan Program

Mountain West Financial is the exclusive lender offering CalPATH, the #1 home loan program for Teachers, Police Officers, Firefighters, and other public employees who serve our local California communities.

You may contact our CalPATH Hotline @ 800-310-7577, seven days a week from (8:30 am to 8:00 pm). A CalPATH advisor will be standing by to answer (any & all) questions you may have about the home buying or refinance process.

We look forward to working with you soon!


Joe Moore

Branch Manager”


Links to External Sources:

  1. Key 2021 Housing Legislation https://www.natlawreview.com/article/california-housing-legislation-effective-2021
  2. A Brief History of California’s Housing Crisis https://www.bloomberg.com/news/articles/2020-02-21/a-brief-history-of-california-s-housing-crisis