Investor Intelligence: California’s 2026 Legal Update and 2027 Preview

A briefing prepared by The Ryan Firm for informed

landlords, property owners, managers, and investors

California is at it again—tightening the grip on landlords with new legislation taking effect January 1, 2026. Both landlords and investors (who might unintentionally become landlords under California law by acquiring a tenant-occupied property) need to be aware. Here’s an overview of the most consequential changes:

Significant Post-Disaster Landlord Duties

New Civil Code sections 1941.8 and 1941.9 impose explicit duties on landlords following natural or declared disasters, which can include earthquakes, floods, fires, riots, infestations, pandemics, and much more. Within a “reasonable time,” landlords must remove debris and mitigate hazards at a disaster-affected property—including smoke, ash, mold, asbestos, water damage, and more—in some cases using licensed remediation contractors. Tenants owe no rent during mandatory evacuations, retain the right to return at the same rental rate after remediation, and the law creates other tenant-friendly rules governing rent handling related to disaster periods. Local municipalities can create additional and more restrictive rules of their own, which landlords and property managers will need to abide by.

Litigation outlook: These statutes don’t exist in a vacuum — they plug into California’s existing habitability enforcement framework in ways that can cascade and create unexpected consequences for landlords. Once disaster debris is present, the unit is presumed uninhabitable until a public health agency or official decides otherwise. In some situations, that presumption can have a domino effect, triggering other restrictions on a landlord’s ability to collect rent or pursue eviction, imposing penalties on the landlord, giving tenants potent defenses to eviction, and giving some tenants a weapon to make frivolous claims. Expect battles over what constitutes a “reasonable time” for a landlord’s remediation of the property — the statute doesn’t define it, and landlords and tenants will have very different views—especially when contractors across a locale might be overbooked because of a disaster. Disputes will also arise over whether remediation was properly completed. Tenants now have an explicit right to demand copies of any environmental studies, testing, or reports obtained as part of remediation. A litigious tenant can comb through those documents to generate a challenge, turning routine remediation into litigation about whether legal standards were met. For the foreclosure purchaser: in the wake of a disaster, foreclosure activity might increase. Be cautious when purchasing “blind”—if the property has legitimate tenants, the new law could impose serious obligations on you that you did not expect.

When disaster strikes, the time to consult counsel is immediately—not months later when a dispute with a tenant has reached the boiling point. The interplay between these statutes is complex; early legal analysis can prevent difficult and expensive problems later.

Landlords Now Required to Provide Stoves and Refrigerators to Maintain Habitability

For leases entered into, amended, or extended on or after January 1, 2026, Civil Code section 1941.1 now requires landlords to provide and maintain a stove and refrigerator in “good working order”—which in some cases may prove to be a blurry standard. New or renewing tenants may opt to provide their own refrigerator, but landlords cannot require this—and a tenant who initially brings their own refrigerator can later demand that the landlord provide one with just thirty days’ notice. Exemptions exist for properties with communal kitchens, single-room occupancy units, and certain supportive housing. Importantly: if either appliance is subject to a recall by the manufacturer or by a public entity, the landlord must repair or replace it within thirty days of receiving notice of the recall. The mere existence of a recall—whether the landlord knows or not—means the stove or refrigerator is deemed automatically unfit. The landlord’s thirty-day repair-or-replace obligation begins upon receiving notice of the recall from any source.

Litigation outlook: Expect appliance conditions to become a new front in habitability litigation. Defense counsel in eviction actions will scrutinize whether appliances met the “good working order” standard—a term the statute does not define. Although the statute doesn’t require landlords to affirmatively monitor for recalls, an appliance becomes legally unfit the moment a recall issues—creating potential exposure. Registering appliances and monitoring recall databases is prudent risk management, though it becomes more burdensome with a mix of different brands and models acquired randomly over time. And because the statute requires landlords to “maintain” these appliances, perhaps add these appliances to your routine inspection checklists—as already done with smoke detectors. Unscrupulous tenants may sabotage their own stove or refrigerator to manufacture a habitability issue. Although landlords do have some protection where tenant misconduct caused the problem (Civil Code § 1941.2), proving sabotage is expensive and difficult. For foreclosure purchasers: these duties apply where a legitimate landlord-tenant relationship exists; holdover former owners and trespassers are not tenants. But where a valid tenancy survives foreclosure or a new lease is entered, the purchaser steps into the “landlord’s shoes” and inherits these obligations—therefore, consider making appliance condition a part of your pre- and post-acquisition due diligence.

Security Deposit Procedures Modernized

Amendments to Civil Code section 1950.5 require landlords who received deposits or rent payments electronically to return security deposits electronically to an account designated by the tenant, unless the parties agree otherwise in writing. Landlords who received payments electronically must also notify tenants in writing of their right to receive the deposit back electronically. Itemized statements may be emailed with consent. For multiple tenants, security deposit refunds must issue as a single check payable to all unless all adult tenants agree in writing to a different arrangement. These rules work alongside earlier 2025 amendments to the law, which require landlords to photograph units at move-in and after the tenant vacates, both before and after any repairs or cleanings for which deductions are claimed.

Litigation outlook: The photo documentation requirements—which came into effect mid-2025—have already affected security deposit litigation, and will continue to do so until all landlords adapt to the new requirements. Landlords without timestamped photos will struggle to prove damages or to justify their deposit deductions. For multi-tenant leases, consider adding a deposit-return designation to your lease packet—signed by all adult tenants at inception—specifying who will receive the refund and in what portions. If you wait until move-out and the tenants aren’t cooperating, or are feuding with one another, you may be stuck issuing one check to all names, which nobody can cash without everyone’s signature.

New Eviction Defense for Social Security Recipients

Civil Code section 1946.3, the “Social Security Tenant Protection Act of 2025,” creates an eviction defense for tenants whose Social Security benefits were terminated, delayed, or reduced due to federal government action or inaction, if that prevented them from paying the rent. The defense applies only to unlawful detainer (eviction) actions based on nonpayment of rent—not lease violations, nuisance, or other grounds. If the tenant’s defense is successful, the court must pause the eviction case until fourteen days after the tenant’s Social Security benefits are restored, or for up to six months if the benefits are not restored. The law is unclear as to how courts will monitor these delays, or whether the tenants will be required to self-report reinstatement of their benefits (and how that would be enforced). The tenant remains liable for the past-due rent and must pay it all, or enter into a payment plan acceptable to the landlord, within fourteen days of benefits being restored. This statute will sunset on January 20, 2029. 

Litigation outlook: This defense will be raised by some Social Security recipients—count on it. A six-month stay is significant leverage, and the evidentiary standard (“provide evidence [of hardship] to the satisfaction of the court”) is vague. Here’s the deeper problem: the statute requires the tenant to pay “past due rent” to avoid eviction, but it’s unclear whether that includes the value of occupancy during the court-imposed stay. Under established law, that period is usually considered “damages,” not “rent.” If courts read the new statute literally, a tenant could pay only the original arrears that triggered the eviction, get the eviction case dismissed and restore the tenancy, but landlords might still be absorbing a loss for the months of occupancy during the court-imposed stay. Depending on how courts characterize the restored tenancy, landlords may need to file a second eviction for the unpaid months—or pursue a separate civil action for damages. This ambiguity will need to be resolved through litigation. Alternatively, the hope is that the Judicial Council devises forms that streamline and clarify this process. Expect this defense to appear in some eviction proceedings as a delay tactic to derail eviction trials. And here’s a hard truth: landlords might eventually get a money judgment for unpaid rent or damages, but the tenants who qualify for this defense rely primarily on Social Security income—which is largely protected from debt collection under federal law. You may “win,” but collecting a monetary award may be very challenging.

Tenant Protection Act Disclosure Flexibility

The Tenant Protection Act requires written notice of just cause eviction and rent cap provisions. Previously, this notice had to be provided as a separate addendum or a standalone document signed by the tenant. Amendments to Civil Code section 1946.2 now permit landlords to incorporate this disclosure directly into the body of the lease. A modest administrative change, and a possible incentive to update old lease templates. (Note: This flexibility does not extend to mobilehome tenancies, which still require the notice as an addendum or separate document.)

Telecom Billing Opt-Out Rights for Tenants

Civil Code section 1942.8 requires landlords to allow tenants to opt out of paying for any third-party internet, cellular, or satellite service subscription offered in connection with the tenancy—including bulk-billing arrangements. Landlords are prohibited from retaliating against tenants who exercise opt-out rights. The statute applies to tenancies commenced, renewed, or continuing month-to-month on or after January 1, 2026, so existing periodic tenancies are covered immediately. If a landlord fails to honor the opt-out, the tenant may deduct the subscription cost from rent. But the statute doesn’t specify how tenants must exercise the opt-out, which invites disputes over whether an opt-out was properly communicated. Consider creating a simple written opt-out form to document the tenant’s choice and to establish a clear process.

New Disclosure Requirements for Real Estate Listings

Not a rule for landlords, but still a notable development for property owners: Business and Professions Code section 10140.8 now requires real estate brokers and salespersons to disclose when listing images for property sales have been digitally altered—including through AI—to add, remove, or change elements like furniture, fixtures, landscaping, or views. The disclosure must include a link to the original, unaltered images. Standard photo adjustments like lighting and color correction are exempt. This applies to your agent’s marketing materials.

Procedural Changes: 2026 (Slightly Speeding Up Commercial Evictions)

Commercial eviction cases just got a little bit faster under Code of Civil Procedure § 1170. Minor changes to the law now limit how long commercial tenants can delay certain procedural hearings. The new changes close one small avenue for delay in commercial evictions.

A Preview of Changes Coming in 2027 (New Technical Hoops for Evictions)

Next year, 2027, California adds new documentation requirements for serving an eviction lawsuit. These will mainly affect process servers, who must photograph their service attempts with GPS coordinates and timestamps. Eviction complaints will also need to include more detail. And if you obtain a default judgment (which is often a “fast-pass” to eviction), the new law will make it easier for occupants to reopen the case by claiming defective service—making you prove it was done right. Here at The Ryan Firm, we will work closely with our process-service vendors to ensure these new requirements are met.

Litigation outlook: Defense counsel will use these tools. Expect more motions challenging service, more court hearings on the issue of service of process, and some additional delays. This isn’t transformative legislation, but it adds procedural complexity that can stretch timelines.

This article provides a general overview of selected California laws and does not address every technical requirement, exception, enactment, or development. The parties, timing, and facts of your matter may yield different outcomes depending on how courts interpret and apply the law in a given case. Nothing herein constitutes legal advice. For guidance on how these changes affect your specific situation, please consult with one of our attorneys at The Ryan Firm – we are proud and privileged to assist you and protect your interests and would love to help.

The Ryan Firm represents investors, developers, lenders, servicers, landlords, property owners, managers, and foreclosure purchasers throughout California in evictions, habitability disputes, real estate litigation, and regulatory compliance. Far beyond landlord-tenant matters, our team brings specialized experience across the full spectrum of real estate and lending law—mortgage foreclosure, loan servicing disputes, title issues, defects, and disputes, real estate transactions, bankruptcy, fraud, elder abuse, and business litigation. If it involves real property or lending, chances are we have handled it—and can help.

Author: Rosty G. Gore, The Ryan Firm, Trial Team Manager and Shareholder