AB-2689 • 2026

Low-income housing tax credits: lease nonrenewal: good cause.

Housing Land Taxes

Passed Legislature

This bill passed both chambers and reached final enrollment, even if later executive action is not shown here.

Sponsor: Ávila Farías
Last action: 2026-04-09
Official status: In committee: Hearing postponed by committee.
Effective date: Not listed

Plain English Breakdown

The official source material does not provide details on the specific conditions for selling accessory dwelling units as condominiums.

Low-income Housing Tax Credits: Lease Nonrenewal Rules

This law changes rules for low-income housing tax credits by defining 'good cause' to allow lease non-renewals if a household's income is too high for at least two years and modifies requirements for accessory dwelling units.

What This Bill Does

Defines 'good cause' for lease nonrenewal in low-income housing projects where the commitment requires all units, except manager’s units, to be restricted to lower income households. This includes cases where a household's income exceeds 140% of the area median income for at least two consecutive years and 30% of their monthly income exceeds fair market rent.
Removes the requirement for safety inspections before selling or conveying an accessory dwelling unit as part of a condominium plan.

Who It Names or Affects

People living in low-income housing projects who might have their leases non-renewed if they earn too much money.
Homeowners with accessory dwelling units who want to sell them separately from the main house.

Terms To Know

Accessory Dwelling Unit: A smaller living space, like a granny flat or in-law unit, that is part of a larger property but can be rented out separately.
Low-income Housing Tax Credits: Money given to developers by the government to build affordable housing for people with low incomes.

Limits and Unknowns

The bill does not specify what happens if a safety inspection is skipped before selling an accessory dwelling unit.
It's unclear how many local agencies will adopt ordinances allowing separate sales of accessory dwelling units as condominiums.

Bill History

2026-04-09 California Legislative Information
In committee: Hearing postponed by committee.
2026-04-07 California Legislative Information
Re-referred to Com. on H. & C.D.
2026-04-06 California Legislative Information
From committee chair, with author's amendments: Amend, and re-refer to Com. on H. & C.D. Read second time and amended.
2026-03-23 California Legislative Information
Re-referred to Com. on H. & C.D.
2026-03-19 California Legislative Information
From committee chair, with author's amendments: Amend, and re-refer to Com. on H. & C.D. Read second time and amended.
2026-03-19 California Legislative Information
Referred to Coms. on H. & C.D. and L. GOV.
2026-02-21 California Legislative Information
From printer. May be heard in committee March 23.
2026-02-20 California Legislative Information
Read first time. To print.

Official Summary Text

AB 2689, as amended, Ávila Farías.
Accessory dwelling units: separate sale or conveyance: condominiums.
Low-income housing tax credits: lease nonrenewal: good cause.
Existing law, in modified conformity with federal income tax laws, establishes a low-income housing tax credit program through which the California Tax Credit Allocation Committee allocates low-income housing tax credits aimed at providing affordable low-income housing within and throughout the state. Existing federal law sets limitations and guidelines regarding what projects are eligible for credits, including a requirement that an extended low-income housing commitment is in effect, and a prohibition against eviction except for good cause.
This bill would specify, for housing projects where the low-income housing commitment requires 100% of the units, not including any manager’s units, to be restricted to lower income households, as
defined, that good cause for nonrenewal of a lease includes cases where the nonrenewal relates to a household whose income exceeds 140% of the area median income for at least 2 consecutive years and 30% of the household’s monthly income exceeds the fair market rent for the county where they reside.
Existing law, the Planning and Zoning Law, provides for the creation of an accessory dwelling unit by local ordinance or, if a local agency has not adopted an ordinance, by ministerial approval, in accordance with specified standards. Existing law prohibits an accessory dwelling unit from being sold or otherwise conveyed separate from the primary residence, except under certain conditions, including if a local agency adopts a local ordinance to allow the separate conveyance of the primary dwelling unit and accessory dwelling unit or units as condominiums, subject to certain requirements. Among these requirements, the ordinance must require a safety inspection of the accessory dwelling unit, as specified, before recordation of the condominium plan.
This bill
would remove the above-described requirement for a safety inspection before recordation of the condominium plan in connection with the separate conveyance of an accessory dwelling unit under these provisions. The bill would authorize a condominium plan to be submitted with a parcel map or a tentative and final map and, after the recordation of the condominium plan, would authorize that portion of the parcel, including the accessory dwelling unit to be sold or otherwise conveyed separate from the primary residence.

Current Bill Text

Read the full stored bill text

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