It has long been assumed that units offered for sale as the result of local inclusionary zoning policies and the state’s density bonus law would go to owner occupants if those units were intended for owner occupancy upon subdivision map approval. However, developers can petition a local government to change the designation after construction from owner occupant ownership to rental, which reduces opportunities for owner occupant purchasers and generally results in corporate ownership of the units.

 

C.A.R. is sponsoring AB 323 to require such units be sold to qualified buyers for owner-occupancy unless the developers of these density bonus or inclusionary zoned units, that were constructed with an affordability covenant or restriction intended for owner-occupancy, can prove that there are no such qualified buyers. If there are no qualified buyers, the developers may then petition the local government to change the unit designation to rental use.