HOA Rental Laws Would Be Substantially Changed Under AB 3182

In the coming weeks, a bill that would alter Home Owner’s Association (HOA) voting laws and rental bans in HOA neighborhoods is due to face a Senate Housing Committee vote.

Assembly Bill 3182, authored by Assemblyman Phil Ting (D-San Francisco), would effectively make rental bans in HOAs illegal, allowing up to 25% of HOA neighborhoods to be rental properties. Current homeowners in HOAs would no longer to be able to vote on having rental bans below the 25% mark, with any current “grandfathered” restrictions in HOAs in the state being removed by AB 3182.

An exception in voting and rental restrictions would be short-term rentals such as Airbnb properties, Under AB 3182, these can still be restricted in HOA neighborhoods.

Assemblyman Ting wrote the bill to help combat the housing and homelessness crises in California, noting that many are currently prohibited from renting houses under HOA rules. Other supporters have also said that house rentals would help bridge the middle-class housing shortage, freeing up cheaper apartments for lower-income Californians in need of housing.

“We must marshal all available resources to address the housing and homelessness crisis,” said Assemblyman Ting in June. “There are millions of homes across the state that have the potential to be rented to Californians in need of housing but that are prohibited from being leased under outdated homeowners association rules. AB 3182 prohibits rental bans in HOAs to allow homeowners who want to rent out their homes.”

Housing advocates agreed with the Assemblyman.

“These areas effectively lock out many potential residents,” said Los Angeles housing advocate Gabriella Ybarra to the Globe. “It’s like an income-based redlining, because many people can’t afford to buy, and the nicest and safest areas are almost exclusively houses and condos, which require buying.”

“This bill would help many people, especially people of color, find good rentable housing.”

“A bonus effect is this perhaps shutting down some HOA areas, which regardless of income level or race or gender, are very much despised because of how much they limit residents.”

Opponents of the bill stress the need to retain ownership rights and to allow HOAs to bring in residents who won’t harm  those in the neighborhood.

“HOAs make sure of residents before moving in,” explained Saul Emerson, an orange County HOA president, to the California Globe. “Many neighborhoods allow whatever to go on, and that can be detrimental to other residents. Others have noise issues, crime issues, and other faults.”

“HOAs aren’t for everyone. I get that. I’ve had some potential residents decide not to come here because of the ‘atmosphere’, and that’s fine. But we have rental restrictions in place because they are way more likely to keep up with their home and not treat it like a rental. They’re more likely not to do anything crazy to reduce property values. It makes perfect sense to have restrictions and allowing residents to vote whether they want rentals here. That bill goes against the wishes of the people that live here and in others HOAs.”

Supporters also note that the rentals, due to factors such as insurance costs and additional upkeep, could actually cost more than a traditional mortgage, effectively helping only making HOA neighborhoods even richer.

“People only pay more under this. It’s crazy,” added Emerson.

The bill has gotten a large degree of support from Democrats and some Republicans crossing the aisle, with the Assembly vote in June  coming to 55-17 in favor. Many Senators have hinted at a probable similar result in the Senate.

AB 3182 is due to be heard in Senate committees in the coming weeks.