For decades, condominiums have been one of the most affordable pathways to becoming a homeowner in the United States.
But in California — where housing affordability remains a top concern for residents — condo production has fallen off dramatically since the early 2000s, severely limiting access to this entry-level market for homeownership.
“We’re just not building them,” state Assemblymember Buffy Wicks (D-Oakland) said of condos. “It’s one of the elephants in the room of homeownership in California. … You kind of don’t have a choice if you’re a young family looking [to buy] a house.”
Between 2011 and 2021, just 3% of all new multi-unit housing in California was condominiums. In Canada, which has a comparable population to the Golden State, condos made up almost 40% of newly built multifamily housing during that decade.
Condos are typically located in urban areas near jobs and mass transit, and cost about 15% to 30% less than single-family homes — a difference that could save buyers almost $100,000 on a down payment in some parts of California, such as the Bay Area, according to an analysis by Zoocasa.
And now, there’s a growing coalition trying to revive condo construction in California by reforming a decades-old law that housing advocates and developers say has put a stranglehold on condo development.
Why condo building slowed to a crawl
They date the problem back to 2002, when a new state law required builders to repair, or provide payouts for, defective construction for up to 10 years on condos, townhomes and single-family homes. In theory, this construction defect liability law standardized the process to ensure that homes are built safely, giving homeowners the power to demand repairs and builders the opportunity to make them.
In actuality, housing experts say, it has led to frequent and often expensive litigation, which might not end with requested repairs. Such lawsuits are most common with condo buildings because homeowner associations can easily sue on behalf of all residents, industry experts say, making for extensive cases, sometimes over minor, non-structural issues, or even unrealized future problems.
“We have a system that incentivized litigation,” said Muhammad Alameldin, director of growth for California YIMBY, a pro-housing policy group. “We want a system where [if] you have a defect, you can get it repaired immediately. It shouldn’t go to the courtroom. Get the lawyers out of it.”
Alameldin has been part of an effort aimed at reforming that 2002 law, with the hope that clearer guardrails around repairs and related litigation will help encourage condo development.
But despite broad support — including the Habitat for Humanity, the city of Los Angeles and the California Building Industry Assn. — the bill that would have cemented those reforms never came up for the final vote it needed before the legislative session ended last month.
It’s a major blow for lawmakers and advocates who have focused on this issue, but most are adamant that this won’t be the end of the effort.
“Housing policy is rarely simple. But if we want more Californians to have a shot at owning a home, we have to be willing to modernize laws that are no longer producing the outcomes they were intended to achieve,” Wicks wrote in a post on social media about the bill she sponsored, AB 1903.
“I have no doubt we can bring back something even stronger,” she said after the bill died.
Although many cities across California are building denser, multifamily housing complexes, most are apartments, which are covered by different construction liability laws. These for-rent units still provide much-needed housing but offer no pathway toward homeownership — long considered key to building wealth in the U.S. In fact, high rents in some of these new developments, often branded as luxury apartments, can make it difficult for renters to save for a home.
“You shouldn’t have to … inherit a home or live an hour and half away from a city” to own a home, Alameldin said. “We have to build homes where people want to live.”
The condo boom — then bust
Condos in California really began to boom for the first time in the 1970s, when housing prices began to rise sharply.
Sticker shock left many moderate-income buyers — especially in pricier, urban areas — more open to buying in multi-unit or high-rise buildings, a trend that has often continued to play out when housing prices have skyrocketed.
Some condos were conversions of existing apartment buildings, but a building boom brought many new units onto the market by the1980s, when one real estate agent told the The Times that condos “are really the only affordable housing choice left out here.”
Despite several changes in the housing market, by the turn of the millennium, condos were once again hot — but then the 2002 liability law went into effect, followed by the housing bust and the Great Recession.
When housing construction began to pick back up in the 2010s, condo projects in California never bounced back, according to data from a 2024 study by UC Berkeley’s Terner Center for Housing Innovation.
The study found that California’s long window for construction liability claims, along with loose parameters for what constitutes a defect, led to an increase in such litigation, which ultimately drove up insurance and building costs. Together, that created “a significant disincentive for developers and contractors to build new condominiums,” the study found.
Can condos be part of a housing solution?
As California grapples with an unprecedented housing crisis — including some of the lowest homeownership rates in the nation, and increasingly older first-time buyers — lawmakers say condos cannot be ignored.
“Condos are such an important part of the housing stock,” Wicks said, calling them key to providing “a foot in the door for that first-time homebuyer.”
“We just don’t have that for hundreds of thousands of people in the state right now,” she said.
Wicks understands condos aren’t the only type of housing the state needs — or even what all Californians want — but she said the multi-unit, for-sale buildings deserve the attention of state leaders.
“It’s part of the overall solution,” Wicks said of condos. She called them “a big part of the equation in our housing crisis.”
Assemblymember Lori D. Wilson (D-Suisun City), who co-sponsored the construction liability reform legislation with Wicks, worked for a home builder before joining the Legislature and said she saw firsthand how such litigation drove up costs for developers considering condo construction.
“When I came to the Assembly, that was something I wanted to focus on,” Wilson said. “I want to reduce the barriers.”
A 2025 analysis looking at California’s construction defect liability law found that multi-unit construction projects for sale, such as for condos or townhomes, cost developers significantly more than building rental units — from $8,000 to $18,000 more per unit. The study attributed that disparity to a “variety of interrelated factors, including insurance premiums, deductibles, peer review quality assurance costs, escalated rates charged by architecture and engineering firms,” making up what the authors called the “construction defect liability cost difference.”
The proposed reforms did face some fierce opposition from homeowner associations and consumer advocates, who argued that such changes to the 2002 law, known as the Right to Repair Act, “undermines California’s longstanding commitment to safe housing” and shifts the onus of safe construction from builders to homeowners, according to a Senate analysis of the bill.
But Wilson said they were careful to ensure that changes wouldn’t take away homeowners’ right to demand fixes or their ability to sue, but narrowed the parameters for both.
“This is going to be a multi-year effort,” said Alameldin, who helped author the bill. “We’ll keep pushing every year until people are incentivized to build more condos and small units for homeownership.”
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