A Little-Known California Law Is Taking Center Stage in 2025: What to Know About Builder’s Remedy 2.0

Reforms to a rarely invoked California law left untouched for more than 30 years took effect on Jan. 1 as the state grapples with a spiraling housing crisis.

Dubbed “Builder’s Remedy 2.0” for its expanded take on the original law, it has the potential to accelerate the approval process for housing projects in non-compliant jurisdictions. To do so, it grants developers more power to bypass zoning restrictions if certain conditions are met. That has some critics worried about balancing statewide housing needs with local control.  

Here’s what California lawyers representing developers, municipalities and other stakeholders need to know.

A refresher on the builder’s remedy

California’s builder’s remedy law is more than 30 years old, but if you hadn’t heard of it until recently, you’re not alone. This Housing Accountability Act provision was created to help developers respond to noncompliance with state housing laws, but it was rarely used due to its narrow scope and a general lack of case law and awareness.

The builder’s remedy applies when local jurisdictions aren’t in compliance with state housing element law, which dictates that they must have plans and regulatory systems that provide opportunities for housing development so that the private market can effectively address California’s housing needs. In such cases, the original version of the law stops local governments from denying a housing development project if that’s inconsistent with zoning ordinance and general plan land use designation.

The builder’s remedy reentered public discussion in 2021, when California began enforcing housing elements more aggressively, putting noncompliant cities at risk of losing local control over zoning. Developers in high-profile disputes, such as those in Santa Monica, invoked the law to advance projects despite local opposition, demonstrating its potential to sidestep local zoning restrictions in favor of state housing goals.

What’s changed?

AB 1893 is the new iteration of the Builder’s Remedy, which Gov. Gavin Newsom signed in July. The law took effect on Jan. 1, and some of the key changes include:

Lower affordability requirements:

The threshold for affordable housing in mixed-income Builder’s Remedy projects used to be 20% affordable units for lower-income households or 100% affordable for moderate or middle-income households. Now, projects qualify if they are at least 7% affordable to extremely low-income households, at least 10% affordable to very low-income households, at least 13% affordable to lower-income households or 100% affordable to moderate-income households. The affordability requirement no longer applies to projects with 10 or fewer units that are smaller than one acre and have at least 10 dwelling units per acre.

Density and site restrictions:

Previously, builder’s remedy projects could be proposed on almost any site and in any form, as long as the local jurisdiction isn’t following state housing rules. This free-for-all approach allowed for a theoretical maximum of unlimited density, triggering lengthy legal battles over zoning and weakening the practical.

AB 1893 changed this by adding new site restrictions, setting minimum and maximum limits on project density and allowing local governments to enforce certain standards to help make the projects work. Projects will be limited to double the current density in most areas and triple the current density in so-called “high-resource areas” with the goal of allowing more projects to be approved and survive litigation.

Streamlined approval processes:

AB 1893 simplifies and protects the builder’s remedy process by ensuring projects are treated fairly and without unnecessary delays. It prevents cities from requiring rezoning and extra approvals or charging special fees. Builder’s Remedy projects will be deemed compliant with local standards, eliminating the risk of being treated as illegal uses.

What do clients need to know?

As these reforms work their way through California’s housing development projects, attorneys will play a critical role in guiding clients through the evolving legal framework. Developers will need clear guidance on navigating the new requirements and capitalizing on opportunities, while municipalities will require support in identifying potential risks. Here are several strategies for helping clients manage these new dynamics.

Strategies for developers

Capitalize on more flexible affordability criteria

Developers should assess a project’s potential to qualify under the new, more flexible affordability thresholds. By including at least 7% affordable units for extremely low-income households or 100% affordable units for moderate-income households, developers can access builder’s remedy perks without having to meet the previously higher affordability requirements.

Understand new site restrictions and density limits

Developers will need to stay informed about the new site-specific restrictions and density limits. Ensuring that projects meet the required site criteria, such as unit density and location size, will be crucial for compliance and avoiding delays.

Leverage the right to bypass local zoning

Encourage developers to be proactive in using the right to bypass local zoning restrictions, particularly in noncompliant jurisdictions, by thoroughly understanding the legal thresholds and procedural steps to file under the builder’s remedy.

Ensure project readiness for faster approval

With restrictions on local agencies’ ability to impose additional approvals or fees, developers can expect a faster approval process. However, it’s essential to ensure all project documents are complete and meet the updated legal criteria to take advantage of this.

Strategies for municipalities

Evaluate housing element compliance

Now’s the time for municipalities to carefully review and update their housing elements to avoid noncompliance with state housing laws, as this could trigger the builder’s remedy. Being proactive will mitigate the risk of losing control over local zoning.

Monitor builder’s remedy projects closely

Municipalities must understand the expanded scope of builder’s remedy and its implications for local land-use policies — and one effective way to do that is by staying informed about any pending builder’s remedy projects to gain valuable insights and anticipate potential challenges.

Prepare for legal challenges

Ensure your clients are aware of the pitfalls of non-compliant jurisdictions seeking to block builder’s remedy projects. Keep clear records and ensure housing element compliance to help municipalities avoid disputes and defend their land-use decisions.

The success of ‘Builder’s Remedy 2.0’ depends on its stakeholders

“Builder’s Remedy 2.0” heralds a significant shift in California housing law with far-reaching implications. The reforms aim to make it easier to use the builder’s remedy provision and encourage development in places without an approved housing element. However, as with any transformative change, its success will depend on the extent to which developers, municipalities and legal professionals understand and leverage its benefits and protections.

For more insights into the California housing law and to leverage CEB’s compliance insights, get in touch to request a free trial.