6 Jul, 2026 · 4 min read
For years, nearly every conversation surrounding California's housing crisis has focused on one question:
How do we build more housing?
It's a valid question. California continues to face a significant housing shortage, and increasing housing production remains one of the state's highest priorities.
But I believe we're beginning to see a subtle shift in the conversation.
Instead of focusing solely on how many homes we build, policymakers are beginning to ask another important question:
What kinds of homes are we building?
That distinction matters.
For the past several years, California has adopted legislation aimed at increasing housing supply through higher densities, streamlined approvals, and expanded development opportunities.
Programs like Complete Communities Housing Solutions, Density Bonus Law, transit-oriented development policies, and recent Land Development Code updates have all helped make multifamily housing more feasible in many communities.
Those efforts are important.
But increasing housing supply doesn't automatically increase homeownership.
Rental apartments and ownership housing operate under very different financial, legal, and market realities. While rental development has continued to move forward, condominiums and townhomes have become increasingly difficult to finance, insure, and deliver.
As a result, California has produced far fewer ownership opportunities than many communities need.
Over the past year, several pieces of legislation have caught my attention—not because of any single bill, but because of what they collectively suggest.
Among them is AB 2433, which proposes additional Density Bonus incentives for qualifying affordable homeownership developments, including condominiums and townhomes.
Other legislation is addressing different pieces of the same puzzle.
AB 1903 seeks to improve predictability around construction defect claims for condominium developments.
AB 1406 proposes changes intended to improve financing and reduce transactional barriers for attached ownership housing.
SB 1116 continues expanding subdivision tools that can help create more attainable ownership opportunities.
AB 2074 focuses on encouraging housing near major transit investments and employment centers.
Viewed independently, each bill addresses a specific issue.
Viewed together, they suggest California is beginning to recognize that rebuilding homeownership requires more than simply increasing housing capacity.
It requires reducing risk.
One of the biggest misconceptions about housing is that projects fail because architects cannot design them.
That is rarely the problem.
Projects become infeasible because uncertainty increases cost.
Construction defect liability.
Insurance.
Financing.
Entitlement timelines.
Infrastructure.
Market absorption.
Construction costs.
Every additional layer of uncertainty increases financial risk.
When enough risk accumulates, developers naturally gravitate toward the product type with the most predictable outcome—which, for many years, has been rental housing.
That isn't because developers don't want to build homes for ownership.
It's because the market often rewards predictability.
Homeownership creates opportunities that renting cannot fully replace.
Ownership allows families to build equity over time.
It creates long-term financial stability.
It encourages investment in neighborhoods.
It provides one of the most effective pathways toward generational wealth.
California will always need rental housing.
But healthy communities need both rental opportunities and attainable ownership opportunities.
The two are complementary—not competing.
Here in San Diego, we're seeing local policy evolve alongside these statewide conversations.
The City's 2026 Land Development Code Update, Complete Communities Housing Solutions program, and continued focus on infill development are creating additional opportunities for higher-density housing in urban neighborhoods.
When local policy begins aligning with statewide legislative reform, new development opportunities often emerge.
That's why I pay attention to policy—not simply to understand what is changing today, but to understand where the market may be heading over the next five to ten years.
Whether every one of these bills ultimately becomes law remains to be seen.
Legislation evolves throughout the process, and not every proposal reaches the Governor's desk.
But I believe the broader trend is becoming increasingly clear.
California is beginning to recognize that solving the housing crisis isn't only about building more units.
It's about creating more opportunities for people to own those homes.
For developers, investors, and landowners, that's a conversation worth paying attention to.
Because policy shapes feasibility.
Feasibility shapes investment.
And investment shapes the communities we build.
At ArchiDev Studio, we believe successful projects begin long before design.
They begin with understanding land, policy, entitlement risk, construction feasibility, and long-term market trends.
That's why we say:
We underwrite land before we design buildings.
If you'd like to discuss how evolving housing policy may affect your next development opportunity, we'd love to start the conversation.
Heather Medina, AIA, LEED AP, NCARB Founder & Principal Architect ArchiDev Studio
Build Smarter San Diego.
