Below is a break down of the 2025 CAR updates.

These updates come from the California Association of Realtors (C.A.R.) and affect everything from buyer representation to security deposits, application fees, and fair housing laws.

To help you stay ahead of the curve, we’ve summarized the most important changes going into effect.

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Download the Full 2025 CAR Legal Update List: Click here to view the full CAR list of new and revised laws

2025 California Real Estate Legal Updates Every Agent Must Know

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⚠️ Legal Disclaimer:

This blog is provided for informational purposes only and is not intended as legal advice. Laws are subject to change, and interpretations may vary. Always consult with your broker, legal counsel, or the California Association of Realtors for clarification. LPT Realty and the author are not liable for any errors, omissions, or actions taken based on this content.

View the updates below…

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🔑Key Legal Changes for 2025

1. Buyer Representation Agreements Are Now Required

Effective January 1, 2025

• You MUST have a written agreement in place before showing a property.

• Applies to all residential sales—not just Realtors, but any licensee participating in an MLS.

• Max agreement period: 3 months (unless the buyer is a company/LLC).

• Must include:

  • Broker compensation and when it’s earned

  • Services provided

  • A termination clause

• No auto-renewals allowed

• No agreement = no showings.

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2. Lease Application Screening Fees (AB 2493)

• You cannot charge a fee if the property is no longer available.

• You must:

  • Disclose non-discriminatory screening criteria

  • Consider applications in the order received

  • Provide credit reports to every applicant who pays a fee

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3. Security Deposit Deductions – New Requirements (AB 2801)

Effective April 1, 2025

• Photos required at move-in and move-out

• Must provide:

  • Photos of repairs/cleaning

  • Written breakdown of costs

• Carpet cleaning only allowed if reasonably necessary

• Only licensed contractors or hourly employees may be used for deductions

💡 Note: LPT Realty does NOT provide property management services. If you coordinate move-ins, take listing-quality photos to cover yourself.

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4. Balcony Inspections Delayed (AB 2579)

• Deadline for most properties pushed to 2026

• No delay for condos/HOAs with 3+ units

• Condos must still:

  • Complete inspections by Jan 1, 2025

  • Provide statutory disclosures

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5. Handyman Exemption Increased (AB 2622)

• Unlicensed individuals may now work on projects up to $1,000 (was $500)

• They must disclose they are not licensed

• Applies to total cost, including labor and materials

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6. Water Tank Disclosure (SB 1366)

• Sellers must disclose if a domestic water tank was installed through state assistance

• Applies if:

  • The seller received aid

  • The tank is still in use

• Treated like a TDS disclosure (buyers can cancel if not disclosed)

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7. Future Gas Appliance Ban Disclosure (SB 382)

Effective January 1, 2026

• Sellers must disclose any future gas bans or requirements

• Must recommend that buyers inspect the electrical systems of the home

• Applies only if the seller or their agent is aware of the rules

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8. Fair Housing – Race-Related Traits Protected (AB 1815)

• The definition of “race” now includes traits such as hair texture, braids, locs, and twists

• Applies to all California business establishments, including real estate professionals

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9. Fair Housing – Discrimination by Perception (SB 1137)

• Discrimination is illegal based on:

  • A single protected trait

  • A combination of traits

  • The perception of a trait

  • Or association with someone who has a protected trait

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10. Foreclosure Postponement (AB 2424)

• Trustee sale can be postponed if:

  • A listing agreement is submitted: adds 45 days

  • A purchase agreement is submitted: adds another 40 days

• Sale price must be at least 67% of appraised value

• Applies to 1–4 unit residential properties

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11. Pool & Spa Safety Requirements (SB 552)

• Home inspections must include:

  • A list of drowning prevention features

  • Confirmation of operability and proper labeling

• Applies to SFRs and condos

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✅ What You Need to Do Next

1. Review the full legal update from CAR

2. Bookmark this blog for reference

3. Update your workflows and documentation

4. Train your team and clients on the new laws

5. Ask questions now before these laws go into effect

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💬 Need Help?

Reach out with any questions or if you need support adapting to these changes.

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