California’s housing affordability crisis remains one of the state’s most pressing issues, with millions of residents struggling to find and keep affordable homes. In response, state lawmakers have advanced a sweeping set of new laws for 2025, aiming to accelerate housing production, reduce costs, and improve access for lower-income families. Here’s a look at the latest legislative efforts, policy changes, and key statistics shaping the future of housing in California.
Legislative Action: Major Housing Bills for 2025
Lawmakers have introduced and passed several significant bills in 2025 to address the affordability gap:
$10 Billion Affordable Housing Bond: A proposed statewide bond (SB 417) would inject $10 billion into affordable housing development, aiming to finance thousands of new units for low- and moderate-income Californians.
Redevelopment and Homeless Prevention: AB 1782 expands the use of the Low and Moderate Income Housing Asset Fund, doubling the annual expenditure limit for homeless prevention and rapid rehousing services from $250,000 to $500,000, with inflation adjustments. It also enables regional collaboration on transit-priority housing and shelters, with safeguards for affordability and anti-segregation.
Voucher Program Transparency: AB 653 mandates that public housing authorities report detailed data on voucher success rates, payment standards, and wait times, with the goal of improving efficiency and transparency. The Department of Housing and Community Development (HCD) will publish annual reports and recommendations for overcoming barriers to voucher use.
Affordable Rent Redefined: AB 846 updates the definition of “affordable rent” for projects receiving public financing, allowing rent levels to align with deed restrictions or regulatory agreements tied to funding sources. The law also limits annual rent increases for projects funded by Low-Income Housing Tax Credits.
Streamlining Construction Financing: AB 1053 allows HCD to provide affordable housing program funds during the construction phase, not just after completion. This change is expected to reduce project costs and accelerate delivery of new affordable units.
Policy Innovations and Regulatory Changes
Building Code Reforms: Some lawmakers are pushing to pause new building code updates through 2031, aiming to reduce construction costs and make housing development more feasible.
Fee Reform: Senate Bill 328 targets the high costs of environmental remediation by reforming Department of Toxic Substances Control fees, unlocking more land for housing, especially in urban infill areas.
Housing Element Accountability: AB 610 strengthens requirements for local governments to be transparent and accountable in updating their housing regulations, ensuring pro-housing laws are effectively implemented.
Latest Housing Affordability Statistics (2025)
Income Limits: For 2025, California’s Department of Housing and Community Development updated income limits based on HUD data. The cap for annual increases in income limits is set at 9.23% for very low-income households, reflecting rising median family incomes and cost pressures.
Housing Production: Despite legislative efforts, California continues to face a significant shortfall in affordable housing units, with demand far outpacing supply.
Rent Burden: Over half of California renters spend more than 30% of their income on housing, a threshold considered “cost-burdened” by federal standards.
Conclusion
California lawmakers have responded to the state’s housing affordability crisis with a robust package of new laws and policy reforms for 2025. By increasing funding, streamlining regulations, enhancing transparency, and redefining affordability standards, these measures aim to make housing more accessible and affordable for all Californians. While the road ahead remains challenging, the latest legislative push represents a significant step toward closing the state’s persistent housing gap and providing relief to millions of residents.
Source:
[1] https://housingca.org/policy/policy-priorities-2025/
[2] https://www.hcd.ca.gov/sites/default/files/docs/grants-and-funding/income-limits-2025.pdf
[3] https://calmatters.org/housing/2025/05/building-code-california-housing/
[4] https://bbklaw.com/resources/la-040325-well-informed-start-to-2025-bbk-s-guidance-for-new-laws-in-california-housing-part-five
[5] https://housingactioncoalition.org/news/2025-legislation-package
[6] https://www.gov.ca.gov/2024/12/28/new-in-2025-building-more-homes-faster/
[7] https://www.housingaffordabilityinstitute.org/state-legislatures-and-housing-reform-2025/
[8] https://bbklaw.com/resources/la-032025-a-well-informed-start-to-2025-bbk-s-guidance-for-new-laws-in-california-housing-part-one