California signs bill to cut affordable housing costs

California Governor Gavin Newsom signed a major state housing bill into law on Monday, July 13, 2026, at a ceremony in Oakland, framing the legislation as a historic step to cut costs and bureaucratic delays for affordable housing construction. The bill, Assembly Bill 179, takes effect immediately and is designed to modernize the state's affordable housing finance system.

The governor signed the bill at the Clara E. Chan Lee Residences, an affordable housing development under construction in Oakland's Chinatown. He was joined by state lawmakers and Oakland Mayor Barbara Lee. Newsom stated that the state's housing shortage was the result of decades of intentional policy, arguing that the system was designed not to build. The new law aims to reverse that by creating a one-stop financing shop and reducing impact fees, which are charges levied on new developments. Officials estimate these changes could lower the cost of building an affordable housing unit by $60,000 to $70,000.

The legislation allocates significant state funding, including $900 million for the Homeless Housing, Assistance and Prevention program for the 2026-2027 fiscal year and $100 million for a new disaster...