What did the California Legislature do with housing laws in 2025?
AI-generated summary reviewed by our newsroom.
- Legislature passed bills to loosen CEQA and expedite housing.
- Lawmakers froze building codes and required faster permits and inspections.
- Funding gaps and local resistance mean outcomes hinge on 2026 policy and beyond.
California legislators had a goal for 2025: try to lower the state’s lofty housing prices by making it easier to build apartments and other homes.
With the help of Gov. Gavin Newsom, they rammed through proposals to further limit the California Environmental Quality Act, a law that at times has been used to slow down or sink housing developments.
They voted to push cities to approve more projects near transit. And they froze building codes and will force local governments to take swifter action on permits and inspections.
The results were surprising to even close watchers of state housing laws.
“I was impressed,” said Ben Metcalf, the managing director of UC Berkeley’s Terner Center for Housing Innovation and the former head of California’s housing agency. “It ended up being a more impactful and significant year than I had anticipated.”
Yet the long-term effects of what the Legislature did in 2025 could largely depend on what happens in 2026.
‘I love 2025’
A defining moment from the year came in June, when Newsom signed two bills meant to speed up home building.
One in particular, Assembly Bill 130, exempts developments in urban areas from the state environmental quality law, also known as CEQA. The new measure also largely prohibits cities and counties from making changes to building standards that apply to residential houses.
The bills were a clear sign that the recent efforts to make it easier to build in California hadn’t worked as well as the governor and legislators had hoped. The state is still notorious for its high housing prices and home building wasn’t happening at scale large enough to significantly alter that reputation. In 2024, housing in California grew at roughly the same rate as it did the year before.
The CEQA-related changes, though, left developers more excited about the future.
“Oh my gosh, I love 2025,” said Linda Mandolini, president of Eden Housing, a nonprofit developer of affordable apartments. Her company is working on projects across California, including a 67-unit complex in Sacramento’s Oak Park neighborhood for people who have lower incomes and are at least 55 years old.
“It’s gonna be a game changer for the state,” she said of AB 130.
Another significant moment came several months later, when the Legislature narrowly passed Senate Bill 79. The highly controversial measure attempts to make it harder for local governments to reject housing developments near transit and rail stops or place height and density limits on the projects.
The bill was the culmination of years of lobbying to promote transit-oriented housing in the state. It only passed after state Sen. Scott Wiener, D-San Francisco, went through more than a dozen rounds of amendments to gain enough support from legislators.
Some of the compromises built into the measure may undercut its effectiveness, said Christopher Elmendorf, a UC Davis law professor. For example, developments must follow local anti-displacement and demolition standards, which he said communities could use to make it harder to build projects. Much of the law goes into effect in July.
“The verdict is very much out on SB 79 and whether that turns out to be a real thing,” he said, “or whether it’s mostly symbolic.”
What’s ahead
Assemblymember Buffy Wicks, a Democrat from Oakland who authored AB 130, acknowledges the criticism that California is still not building enough homes to greatly lower prices despite the flurry of bills passed by the Legislature in recent years.
“It took us decades and decades to get here,” she said, “and it’s going to take a minute to get out of it.”
Wicks is working on what she sees as two remaining obstacles.
To target one of them, she is leading a committee of legislators that will put forward ideas in 2026 on how to make construction cheaper in the state. It is expected to explore the use of homes that are built using pre-manufactured sections instead of completely from scratch on site.
“We just haven’t touched a lot of that in the Legislature,” she said. The group is expected to hold public hearings this winter before introducing bills.
Wicks is also the lead author of a housing bond that aims to create $10 billion to support home building and rehabilitation, down payment assistance, development subsidies and other efforts. An attempt to place the bond in front of voters statewide failed in 2025 for the second year in a row, frustrating Mandolini and many others.
Chione Flegal, the executive director of Housing California, said that made 2025 a bittersweet year. Disappointing, because legislators haven’t yet placed the bond on the ballot. But encouraging because they approved $800 million annually for a program that funds projects meant to reduce greenhouse gas emissions, especially those that affect lower-income Californians.
Affordable housing projects are ready to be built, she said, and could move forward with more state funding.
“The money is what’s going to get them over the finish line.”
It will take years to know if legislators are getting closer to the goal they set out for in 2025. But Metcalf, from the Terner Center, sees their activity on housing as the result of a shift in thinking.
“There’s a sense that voters are demanding action on affordability,” he said. “It’s creating an imperative that if you really want to be able to successfully legislate in Sacramento, that you have to legislate differently than you had to five or six years ago.”
That could mean more ambitious housing measures in the years to come.
This story was originally published December 30, 2025 at 5:00 AM with the headline "What did the California Legislature do with housing laws in 2025?."
