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Bills

AB 1406: Attached residential condominium sales: liquidated damages.

  • Session Year: 2025-2026
  • House: Assembly

Current Status:

In Progress

(2026-01-14: Read second time and amended. Ordered returned to second reading.)

Introduced

First Committee Review

First Chamber

Second Committee Review

Second Chamber

Enacted

Version:

Existing law establishes that for the initial sale of a newly constructed condominium unit, as specified, the amount actually paid to the seller in the event of a buyers default pursuant to a liquidated damages provision that exceeds 3% of the purchase price of the residential unit is subject to specified requirements, including an accounting of the sellers costs and revenues, as specified.

This bill would delete the above-specified percentage and, instead, increase that percentage to 10%.

Existing law deems a provision in a contract to purchase and sell residential property that provides that all or any part of a payment made by the buyer constitutes liquidated damages to the seller upon the buyers failure to complete the purchase of the property to be valid if certain conditions are satisfied, including, among others, whether the amount actually paid pursuant to the liquidated damages provision exceeds 3% of the purchase price.This bill would delete the above-specified percent and, instead, apply 10%.

Discussed in Hearing

Assembly Standing Committee on Judiciary53MIN
Jan 13, 2026

Assembly Standing Committee on Judiciary

View Older Hearings

News Coverage:

AB 1406: Attached residential condominium sales: liquidated damages. | Digital Democracy