AB 3182

AB 3182, effective January 1, 2021, is a California law that significantly restricts HOA authority to impose rental restrictions in common interest developments. The law was enacted to address the state's housing shortage by preventing associations from artificially reducing the rental housing supply. Under AB 3182, codified in Civil Code Section 4741, an HOA cannot prohibit the rental or leasing of units entirely and must permit at least 25% of the separate interests (units or lots) to be rented or leased at any given time. If an association has existing rental caps below 25%, those provisions are void to the extent they conflict with the law. The law also voids any CC&R provision or rule that requires HOA approval of a tenant, applicant screening by the association, or any other restriction on an owner's choice of tenant, except that the association may enforce reasonable occupancy limits based on the size of the unit. Short-term rental restrictions (typically defined as rentals of 30 days or fewer) are not affected by AB 3182 — associations may still prohibit or regulate short-term rentals. The law applies retroactively to existing CC&Rs, meaning associations cannot rely on older governing document provisions that impose stricter rental limits. For board members, AB 3182 means reviewing and updating any rental restriction policies to ensure compliance, removing any tenant approval requirements beyond occupancy limits, and updating governing documents to reflect the 25% minimum rental allowance. Associations that enforce non-compliant rental restrictions risk legal challenges from owners whose rights under the statute are being violated.