Overview
California homeowners are entering 2026 facing overlapping crises: AB 130 fine enforcement, rising insurance costs, mounting special assessments, disputes over ADUs, and recall elections. Each of these issues has the potential to spark conflict, lawsuits, and major financial fallout for HOA members across the state. This Fact Sheet highlights the five disputes most likely to dominate the year.
For a deeper analysis, see my article: “Top 5 HOA Disputes for 2026 in California: AB 130, Insurance, Special Assessments, ADUs, and Recalls.” You can also watch an episode of my podcast, HOA HELL, on the same topic by clicking here.
Key Points
California HOAs face five pressure points in 2026 that will likely drive conflict, costs, and lawsuits: AB 130 enforcement, insurance, special assessments, ADUs, and recalls. The key points below summarize what is happening, why it matters to homeowners, and where boards are most likely to overstep. Use them as a quick checklist to spot risk early and prepare your response.
- AB 130 enforcement will generate lawsuits. AB 130 capped HOA fines at $100 per violation and eliminated interest and late fees, but left major ambiguities about follow-up enforcement. Some boards are freezing enforcement altogether after one fine, while others are skipping fines and moving straight to ADR or lawsuits. Both approaches create higher risks and costs, leading to more lawsuits and more financial exposure for homeowners.
- Insurance costs will rise while coverage shrinks. Premiums for HOA insurance policies are climbing rapidly, while carriers are pulling back coverage, especially for high-risk components like balconies. Many boards are underinsuring compared to what their CC&Rs require, which constitutes a breach of fiduciary duty. This underinsurance leaves members exposed to lawsuits and massive special assessments if losses occur.
- Special assessments will spike as reserves fail. Years of underfunded reserves are now colliding with the real costs of repairing roofs, roads, elevators, pools, and façades. More and more associations that failed to save responsibly are resorting to special assessments in the $40,000–$60,000 range per unit. The mandatory balcony inspections under Civil Code 5551 are responsible for a good number of these issue.
- ADU disputes will expand. State law gives homeowners the right to build accessory dwelling units (ADUs) and sharply limits HOA restrictions. Boards cannot impose unlawful hurdles like ADU-only fees, excessive setbacks, or neighbor approval requirements. HOAs may enforce only reasonable conditions tied to code compliance, aesthetics, and safety. Despite these limits, many boards are already overstepping, setting the stage for more disputes in 2026.
- Recall elections will surge. Homeowner frustration with AB 130 enforcement, spiking insurance, and mounting special assessments is driving a surge in recalls. The rollout of electronic voting systems adds new opportunities for error and contested results. Recalls are poised to become one of the most common accountability tools used by homeowners in 2026.
- How homeowners can prepare. Homeowners should demand records under Civil Code 5200, compare insurance coverage against CC&R requirements, track reserve studies, and monitor enforcement attempts under AB 130. They should also learn recall petition thresholds and ballot procedures so they can act quickly if leadership accountability fails. By preparing early, homeowners will be positioned to protect themselves financially and politically in 2026.
In short, California’s HOA landscape in 2026 will very likely be defined by the following five disputes: AB 130 enforcement, rising insurance costs, underfunded reserves and special assessments, ADU restrictions, and recall elections. Homeowners who prepare now will be far better equipped to navigate the conflicts ahead and hold their boards accountable.
About MBK Chapman Fact Sheets
Homeowners searching for answers online will often come across “articles” that appear to be authoritative, but are actually designed as nothing more than search-engine marketing dumps. These pieces emphasize keyword inclusion rather than providing clear, related, and accurate analysis. Unfortunately, this approach can leave homeowners more confused than informed.
At MBK Chapman, our Fact Sheets, which are part of our HOA Law Library, are deliberately concise, statute-based, and are designed as quick-reference guides to help California homeowners understand key HOA laws at a glance.
Our Articles, by contrast, are designed for deeper analysis, context, and strategies that go beyond the quick-reference points covered in the Fact Sheets. Unlike much of what appears online, our Articles are not written by AI, and they contain nuanced discussion, real-world examples, and actual analysis of complex issues related to the daily lives of HOA members in California. In short, our Articles prioritize function and clarity over SEO word-dumping.