California lawmakers have moved a step closer to putting a hard lid on how much homeowners associations can hike monthly dues without asking residents first, escalating a quiet but very real fight over who controls the cost of HOA life.
Senate Bill 1007, carried by Sen. Caroline Menjivar, would clamp board-imposed increases at 8 percent a year and beef up budget transparency rules for associations. The measure cleared the Senate on a 24–13 roll call, with Democrats unusually split in public over the plan.
What SB 1007 would change
Under the California Legislature, an HOA board could not raise regular assessments more than 8 percent above the prior year without approval from a majority of a quorum of members. Annual budget reports would also have to spell out year-over-year comparisons of expenses and other line items, so owners can see what actually changed.
The bill goes further on enforcement. Associations would have to make any physical evidence used to determine a violation available to members before a hearing, a shift supporters say would cut down on surprise fines and murky accusations. Those transparency requirements and the 8 percent limit sit at the core of both the bill text and the sales pitch from backers.
How many homeowners are affected
HOAs are no longer a niche corner of the housing market. More than a third of Californians now live in an association, and the share of new single-family homes built inside HOAs has climbed sharply in recent years.
Nationally, about 21.6 million households paid a condo or HOA fee in 2024 and the median monthly condo or HOA charge was $135, according to the U.S. Census Bureau. As CalMatters notes, Californians are paying more than that, with recent estimates putting median HOA costs in the state close to $300 a month.
Why supporters back the cap
Menjivar and consumer advocates argue that tying board power to an 8 percent trigger, and requiring a homeowner vote above that, protects residents on fixed incomes from sudden jumps and forces boards to show their math.
“This bill is about providing information to a homeowner to understand how much they’re gonna be paying,” Menjivar told colleagues in a hearing, according to CalMatters. Backers say that structure allows for predictable, modest increases year to year, with a built-in safety valve in the form of a member vote when boards want bigger hikes for major projects.
Why critics say the cap could backfire
Board members, developers and some lawmakers see the 8 percent cap very differently. They warn that a hard line on regular dues could leave associations short when big-ticket repairs or insurance spikes hit, pushing boards toward more frequent special assessments or putting off maintenance altogether.
Opponents also flagged potential fallout in the mortgage market. During floor debate, some lawmakers cited concerns that lenders may hesitate to underwrite loans in communities with thin reserves, an issue highlighted by Times of San Diego. Sen. Catherine Blakespear, who voted no, said she does not see boards as profiting at owners’ expense and instead pointed to rising energy and insurance costs as key drivers of fee increases.
A recent law already clipped one HOA power
SB 1007 is not the first time Sacramento has tried to rein in HOA authority. Last year’s budget process quietly folded language from SB 681 into AB 130 that capped most individual HOA fines at $100 per violation. The change surprised industry lobbyists and board leaders, who suddenly had far less room to pile on daily penalties.
That fine cap, enacted as part of the 2025 budget, drew broad coverage for its immediate impact on how associations enforce rules. The Los Angeles Times reported on the shift when it took effect.
Where the bill stands now
SB 1007 has cleared the Senate and is now in the Assembly’s hands. Sponsors amended the bill in mid June, and it was re-referred to Assembly housing committees for more scrutiny.
The Senate’s third-reading vote on May 27 was recorded as a 24–13 roll call, according to the Legislature's vote record. Third-party tracker LegiScan lists the bill as amended and active in Assembly committees, reflecting those recent actions.
Whether SB 1007 ultimately becomes law will turn on how the Assembly weighs monthly affordability for homeowners against the need for solid reserve funds and reliable insurance coverage. For now, the proposal has shoved HOA dues, reserve planning and board transparency into the center of California’s broader housing affordability debate.
