Unlawfully restrictive covenants: housing developments: reciprocal easement agreements.

Assembly Member Schultz's proposal to amend California's Civil Code expands provisions for modifying restrictive property covenants beyond affordable housing to include commercial-to-residential redevelopment projects. The legislation allows property owners and developers to invalidate covenants that limit residential density or occupancy when redeveloping commercial properties into housing permitted under state law or local regulations.

The bill establishes a structured process for covenant modifications, requiring owners to submit documentation to county recorders for review by county counsel. Upon approval, owners must notify interested parties through certified mail or public notice. The modification maintains the original covenant's effective date but removes restrictions on residential development. County recorders may charge standard fees for processing these modifications.

While broadening modification rights, the legislation preserves certain restrictions. Covenants related to aesthetic standards, common area maintenance fees, and rent limits remain enforceable if consistently applied. The bill also exempts specific conservation easements, particularly those recorded before 2022 or held by accredited land trusts. Local building codes and zoning requirements continue to govern development standards, and projects must comply with state housing laws and local planning documents.