The California Apartment Association has defeated a bill that would have imposed new restrictions and penalties on the sale of one- to four-unit rental properties by certain property owners.
In a hearing before the Assembly Judiciary Committee on June 30, SB 880, by Sen. Aisha Wahab, D-Fremont, received four yes votes, with the remaining eight committee members declining to approve it.
The legislation began the year in the Senate with very different language relating to the signing and delivering of a document in connection with the transfer, cancellation, or reconveyance of any title. With no advance notice, on June 11, 2026, in the final days of the legislative process, the bill was amended to add new restrictions on how certain rental properties are marketed and sold.
The bill proposed to require designated property owners to give tenants a first right to purchase the property before making it available to other buyers.
SB 880 would have prohibited an “off market” transfer, a “pocket listing,” or other marketing practices designed to favor investors or affiliated buyers.
Additionally, the bill authorized the attorney general, a city attorney, or a county counsel to bring an action against property owners who violated the law. Penalties included:
- $50,000 for the first violation;
- $200,000 for each additional, or subsequent violation; and
- A civil penalty of $1,000,000 per violation or three times the purchase price of the residential real property,
In a June 22 opposition letter, CAA argued that the measure would have duplicated existing tenant protections, delayed legitimate sales, complicated financing, added enormous legal risk, and included extreme penalties without doing anything to address California’s housing shortage.
