California Condo Owners May Face Higher HOA Fees
New legislation would require associations to boost reserve funding for major repairs, potentially increasing monthly costs for residents.
Updated on Sept. 27, 2026 in Saving
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Should homeowners be mandated to pay higher fees to ensure long-term building maintenance?
Governor Gavin Newsom faces a September 30 deadline to sign Assembly Bill 2050, which mandates that homeowner associations maintain specific reserve funding levels for major repairs. The measure aims to ensure funds exist for long-term maintenance, with requirements taking effect in January 2032.
Why it matters
The bill is designed to prevent homeowners from being blindsided by surprise costs for major repairs, a risk highlighted by the 2021 collapse of Champlain Towers South in Florida. For households, this shift could mean higher monthly HOA dues or sudden special assessments to meet new statutory funding minimums.
Associations with insufficient reserves must transfer at least 15 percent of their annual operating budget into reserves beginning in 2032. For some households, this could result in monthly cost increases between $300 and $800, or an annual expense hike of roughly $3,600.
The players
Gavin Newsom
The Governor of California who is tasked with signing or vetoing state legislation.
The details
Assembly Bill 2050 mandates that associations project necessary repairs over a 30-year period and maintain reserve balances above zero. If an association cannot meet these funding levels through regular budgets, it must levy special assessments on homeowners. This shift mirrors policies adopted in Florida following the 2021 building collapse that killed 98 people.
Timeline
June 2021: Champlain Towers South collapsed in Surfside, Florida.
August 2026: Assembly Bill 2050 passed the California state legislature.
September 30, 2026: Deadline for Governor Newsom to sign the bill.
January 2032: Reserve transfer requirements begin for associations.
Money Landscape
This legislation reflects a broader push for increased oversight of multi-unit residential maintenance following the 2021 Florida building disaster. It marks a significant shift toward mandatory long-term capitalization for associations, moving away from current practices that often rely on low reserve cushions.
Homeowners should review their association's most recent reserve study to determine if their community is currently underfunded. If you live in an association, discuss the potential for future special assessments or monthly dues increases with your board or a financial professional.
The takeaway
Legislators are aiming to ensure that building maintenance costs are predictable rather than sudden. Homeowners should track upcoming board meeting minutes to see how their specific association plans to address these potential reserve-funding requirements.
Further reading
For more on managing long-term housing costs, visit our Saving section.
Live Poll
Should homeowners be mandated to pay higher fees to ensure long-term building maintenance?
