SB 1116 Is on the Governor's Desk. What It Changes for Small-Lot Subdivisions in Los Angeles.

California's starter home subdivision law is being rewritten for the fourth time in five years. SB 1116 cleared both houses without a recorded no vote, was enrolled and presented to the Governor at 6 p.m. on August 31, and he has until September 30 to sign it or veto it. If he does neither, it becomes law anyway. If it survives, the new rules attach to applications a local agency receives on or after January 1, 2027.

That last clause is the operational story.

Four rewrites, because cities kept finding the seams

The Starter Home Revitalization Act lets an owner subdivide an urban parcel into as many as ten lots and build as many as ten for-sale homes, ministerially, with no hearing and no CEQA review, decided within 60 days or deemed approved. SB 684 put the current machinery in place effective July 1, 2024. SB 1123 extended it to vacant single-family land effective July 1, 2025. AB 130 added a remainder parcel later that year.

Each rewrite exists because the last one got absorbed locally, and the state's own file says so. In February 2025 HCD told Oakland it could not require a conditional use permit on a qualifying project, and had to cut its open space requirement far enough to fit seven homes on a 6,034 square foot lot. A companion letter told Hayward the law reaches any zone that allows multifamily housing, not only zones that are exclusively multifamily.

> Twenty months passed between SB 684 taking effect and the first project built under it breaking ground anywhere in California, a six-unit townhome development in Campbell in early March 2026.

What the bill actually moves

Read against the enrolled text rather than the summary, four provisions change physical yield. Height limits are made to apply "exclusively to the physical height of a building rather than the number of floors," which retires the two-story cap as a way to stop a three-story stack. Setbacks between the newly created parcels are prohibited except where the building code requires separation. An individual new parcel can fall to 480 or 960 square feet as long as the average across the new lots still clears 600 or 1,200. And stairs come out of the 1,750 net habitable square foot average, which on a townhouse is real living area recovered on every floor. A new Civil Code section also voids private covenants that would physically preclude a qualifying project, reaching a layer of restriction that zoning preemption never touched.

Los Angeles already built most of this in

Read the City's October 28, 2025 inter-departmental memo before assuming SB 1116 changes your site. Los Angeles already bars setbacks between units, caps parking at one space per unit with waivers near transit, refuses to apply a conditional use permit, and applies the state floor area ratio minimums of 1.0 and 1.25 instead of the 0.65 ceiling the mansionization rules top out at.

Height is the exception, and it is the one that matters here. The statute lets a city deny relief from height limits in single-family zones, and LA has said plainly that it will use that: any request to modify height in a single-family zone needs additional justification and sits with Planning Department discretion. LA's caps are already written in feet. The provision drawing most of the coverage is aimed at a workaround this city was not using, and the discretion this city does hold is untouched.

The filing date becomes a design decision

An application filed in Los Angeles before January 1, 2027 lives its entire life under the current rules. One filed after gets the new ones. On most sites that gap is small. On a narrow parcel where the setback prohibition and the stairs exclusion decide whether a fourth home fits, it is the difference between a deal and a redesign, and it belongs in the pro forma now rather than in December.

One more line is worth flagging. The bill redefines vacant to include a parcel whose only structure is abandoned and uninhabitable. LA's memo already reads it that way and lists the evidence it will take, down to 180 consecutive days of dead LADWP service. The boarded-up house on an R1 lot that everyone wrote off as ineligible has been eligible in this city since last October.

Sources

California Legislature via LegiScan, SB 1116 bill text, enrolled and presented to the Governor August 31, 2026: https://legiscan.com/CA/text/SB1116/id/3412194

Los Angeles City Planning, LADBS and Bureau of Engineering, Starter Home Revitalization Act implementation memo, October 28, 2025: https://planning.lacity.gov/odocument/1b081b86-f735-43e8-bba6-c2d73a192db7/SB%5F684%5F1123%5FMemo%5FUpdate%5FACP.pdf

California HCD, Letter of Technical Assistance to the City of Oakland, February 19, 2025: https://www.hcd.ca.gov/sites/default/files/docs/planning-and-community/HAU/oakland-hau-1147-sb-684-ta-02192025.pdf

California HCD, Starter Home Revitalization Act housing law fact sheet, April 2026: https://www.hcd.ca.gov/sites/default/files/docs/planning-and-community/starter-home-revitalization-act.pdf

Office of Senator Anna Caballero, SB 1116 fact sheet: https://cayimby.org/wp-content/uploads/2026/03/3.4.26-SB-1116-Caballero-SHRA-Fact-Sheet.pdf

California YIMBY, SB 1116 bill page and vote history: https://cayimby.org/legislation/sb-1116/

HousingWire, California legislators re-try to loophole-proof starter home law, May 22, 2026: https://www.housingwire.com/articles/starter-home-law-cleanup-bill/

San Francisco YIMBY, Expedited townhome project breaks ground at 300 Redding Road in Campbell, March 11, 2026: https://sfyimby.com/2026/03/expedited-townhome-project-breaks-ground-at-300-redding-road-in-campbell.html

Status as of September 10, 2026. This is analysis, not legal advice.