Effective July 1, 2026, California replaced the Business, Consumer Services, and Housing Agency with a new California Housing and Homelessness Agency. The bill also creates a Housing Development and Finance Committee (“HDFC”) to centralize affordable housing finance decisions, and an Executive Committee within the HDFC. This Executive Committee has significant power, with limited oversight. It is made up of a panel of state officials chaired by the Secretary of the California Housing and Homelessness Agency, and includes the Director of Housing and Community Development, the Executive Director of the California Housing Finance Agency, the State Treasurer, and the State Controller as voting members, with nonvoting representatives from a county, a city, and the Department of Finance. 

The Executive Committee controls the awarding of tax-exempt bonds. Once it approves a qualifying project, it transmits the application to the California Debt Limit Allocation Committee (“CDLAC”). CDLAC must reserve at least half of the 90% bond dedication for projects this committee has funded until July 1, 2029. 

The bill also limits two procedural checks that apply to most state committees: the Administrative Procedure Act and the Bagley-Keene Open Meeting Act. The Executive Committee may set the rules governing its bond allocation and program awards without following the APA’s standard rulemaking process. Additionally, some of their meetings will not be open to the public, including when members meet as part of the Governor’s cabinet or the committee’s staff meet to prepare guidelines and policy recommendations without taking final action.

The effect is that a small group of primarily state officials will have the power to decide which projects have access to the cheapest capital.

The Newsom administration describes the financing changes as One-Stop Shop reforms designed to reduce duplicative reviews across state programs. The Governor’s office estimates that those reforms will reduce the cost of building an affordable unit by roughly $60,000 to $70,000. 

AB 179 also pressures local governments to reduce fees that raise the cost of building. When a city or county serves as the lead applicant for a state-funded affordable housing project and keeps in place the development impact fees it would otherwise charge, the awarding agency must reduce the project’s award. The rule applies to funding opportunities issued after July 1, 2027, and it uses state money as leverage to encourage local fee relief.

The bill carries one provision of particular interest to homeowners recovering from the January 2025 wildfires. AB 179 establishes a Disaster Rebuilding Assistance Program at the California Housing Finance Agency, and the budget directs $100 million to a new Disaster Rebuilding Fund to reduce financing costs for homeowners repairing or reconstructing homes after a disaster. 

The larger budget package surrounding AB 179 continues the state’s housing spending. It extends the Homeless Housing, Assistance, and Prevention program with $900 million for the coming fiscal year, adds $500 million for enhanced state low-income housing tax credits, and directs $200 million to the Multifamily Housing Program. 

While AB 179 is a financing bill rather than a zoning bill, it continues the state’s direction to push for faster development at every stage of the process, and to eliminate barriers by local governments. By concentrating financing authority in one committee and tying state awards to local fee relief, the state is giving developers a faster and cheaper route to capital while pressuring cities and counties to cut costs.

Pooja S. Nair is a Partner and Chair of the Food, Beverage, and Hospitality Department at Ervin Cohen & Jessup LLP. She represents clients in real estate litigation and complex business disputes involving contracts, employment, intellectual property, and fraud. Her insights have appeared in Law360, Daily Journal, The New York Times, and the Los Angeles Times. Before joining ECJ, she led the Food and Beverage practice at TroyGould and practiced white-collar defense at Foley & Lardner. She also serves on nonprofit boards and has been recognized as one of Los Angeles’s Top Litigators and Trial Attorneys and Most Influential Women Lawyers by the LA Business Journal.

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Compass v. Zillow

Compass filed a federal antitrust lawsuit against Zillow in June 2025 in the Southern District of New York. The lawsuit attacked Zillow’s Listing Access Standards, which, at the time, required any publicly marketed home to be entered into a multiple listing service and syndicated to Zillow within one business day, or be blocked from appearing on Zillow and Trulia. Compass alleged that the Listing Access Standards in effect created a “Zillow Ban.” Essentially, Compass’ lawsuit claimed that Zillow used its 66% market share of the U.S. real estate audience to force homeowners onto Zillow. Compass also claimed that Zillow had conspired with Redfin and other companies to pressure them to adopt the same rule, effectively squeezing out Compass. Compass asked the court for an order that Zillow’s conduct violated the antitrust laws, and for an injunction blocking Zillow from continuing its policy.

After a four-day hearing, the court denied Compass’ request for an injunction against Zillow. The judge found, among other things, that there was no evidence of an anticompetitive agreement between Zillow and Redfin. Moreover, Compass had not shown that Zillow had the power to exclude competition. While the order was not a final judgment and the case could have proceeded to trial, it signaled that Compass could have a hard time winning the case on the merits. Zillow trumpeted the victory, calling it a “clear victory not just for Zillow, but for consumers, agents, brokerages and the real estate industry at large.”  

A few weeks after the court’s order, Compass announced a three-year partnership with Redfin. Under this partnership, Compass’ “Coming Soon” listings would immediately appear on Redfin. Those listings will be displayed on Redfin with no days on market, no price history, and no home valuation estimates. Redfin also announced that it would not ban any listings if they were pre-marketed before being submitted to the MLS. 

On March 17, Zillow announced a change to the Listing Access Standards. Under the updated standards, as long as a listing is displayed on a “public-facing website, mobile app, or internet real estate portal,” it is eligible to be listed on Zillow, regardless of whether it is placed on the MLS or another website. If a listing is not accessible to the general public, it is generally not eligible for display on Zillow sites. By expanding the definition to include non-Zillow and non-MLS affiliated sites, Zillow is trying to avoid monopoly implications, since a preview listing can be placed on any public-facing website and be eligible to be later listed on Zillow.

The same day, Zillow also launched a new product called Zillow Preview, which permits participating brokerages to display pre-market listings on Zillow and Trulia before the listings are entered into the MLS. 

The day after Zillow revised the Listing Access Standards, Compass filed a notice of voluntary dismissal of its lawsuit, without prejudice. Without prejudice means that Compass would have the option to refile later. While that seemed unlikely at the time, it turns out the fight was just shifting venues.

Zillow Strikes Back

On May 12, Zillow filed its own antitrust lawsuit, this time against Compass and Midwest Real Estate Data LLC (“MRED”), the dominant multiple listing service for the Chicago area. Zillow is now the plaintiff, and it is claiming that Compass and MRED conspired to undermine Zillow’s Listing Access Standards in certain markets.

Zillow’s complaint claims that after Compass lost its preliminary injunction motion in February, it began pursuing a backup plan. Compass holds three of the fifteen seats on MRED’s Board of Managers and is MRED’s largest customer. According to Zillow, Compass leveraged that influence to get MRED to change its listing feed rules in October 2025. 

The revised rules state that recipients of MRED’s listing data, like Zillow, cannot exclude listings based on “the identity of any participant, brokerage firm, subscriber, licensee, or representative.” In practical terms, this means Zillow could not apply its Listing Access Standards to Compass listings without risking termination of its access to all MRED listings.

Zillow says this matters because MRED has roughly 98% market share for residential listings in the Chicago area. Losing access to that feed would effectively shut Zillow out of the Chicago market. Faced with that threat, Zillow has not enforced its Standards against Compass listings in the Chicago region. Zillow alleges that on April 24, MRED and Compass announced a national partnership, which was designed to extend MRED’s coercive power beyond the Chicago area, and that Compass reached similar deals with other regional providers. On May 5 and 6, MRED threatened to suspend Zillow’s access to MRED data if Zillow did not restore Compass listings in Florida, Georgia, and California. 

Zillow’s complaint alleges that Compass and MRED are improperly denying Zillow listings data in order to coerce Zillow to abandon its Standards. It is asking the court to enjoin Compass and MRED from continuing the alleged conspiracy and block enforcement of MRED’s revised rules. 

Interestingly, Zillow’s role has now reversed. In Compass v. Zillow, Zillow argued that it lacked the market power to exclude competition, even with a 66% market share. It now has to explain to the court why MRED has the monopoly power needed to support Zillow’s antitrust claim. 

The Compass v. Zillow legal fight may have ended, but the Zillow v. Compass fight is just getting started, and the underlying business dispute will have a big impact on the real estate market.  

Pooja S. Nair is a Partner and Chair of the Food, Beverage, and Hospitality Department at Ervin Cohen & Jessup LLP. She represents clients in real estate litigation and complex business disputes involving contracts, employment, intellectual property, and fraud. Her insights have appeared in Law360, Daily Journal, The New York Times, and the Los Angeles Times. Before joining ECJ, she led the Food and Beverage practice at TroyGould and practiced white-collar defense at Foley & Lardner. She also serves on nonprofit boards and has been recognized as one of Los Angeles’s Top Litigators and Trial Attorneys and Most Influential Women Lawyers by the LA Business Journal.

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The homeowners say they never hired Ortiz, never met her, and never owed her a dollar. On Feb. 26, 2026, LAPD’s Real Estate Fraud Unit arrested Ortiz. On March 3, the Los Angeles County District Attorney’s Office charged her with 25 felony counts of knowingly causing a false instrument to be recorded in a public office, under California Penal Code section 115(a). She pleaded not guilty. Bail was set at $700,000. If convicted as charged, she faces up to 24 years in state prison.

Beyond the headline is a cautionary tale for property owners about how the mechanic’s lien system works, why it was vulnerable to this kind of abuse, and what remedies they have if a fraudulent lien lands on a title.

California’s mechanic’s lien law is grounded in the California Constitution and codified in the Civil Code. The purpose of the law is to protect a contractor, subcontractor, laborer, or material supplier who improves real property and goes unpaid. It allows them to record a claim against the property itself. If the owner still refuses to pay, the claimant can sue to foreclose the lien and force a sale. The system favors the contractor over the property owner by providing them with a secured interest in the property value for work completed. For legitimate contractors, it is often the only leverage they have against a nonpaying owner.

At a high level, the mechanic’s lien process has four main steps. First, a contractor who lacks a direct contract with the owner must serve a 20-day preliminary notice identifying the project and the work. Second, the claimant must record the lien within strict deadlines (generally 60 to 90 days after completion, depending on whether a notice of completion was filed). Third, the claimant has 90 days from recording to file a lawsuit to foreclose on the lien. Fourth, if no suit is filed, the lien expires by operation of law.

When a mechanic’s lien is presented for recording at the County Registrar-Recorder, the clerk performs only an administrative review. The clerk checks that the document has the right format, the right signatures, a notary acknowledgment, and the required statutory language. The clerk does not verify whether the work was done, whether a contract existed, whether the claimant is licensed, or whether the amount claimed is plausible. 

The trade-off is that the system relies on two backstops: the 90-day foreclosure deadline, which forces a dishonest claimant into court where the claim can be tested, and the criminal law, which punishes anyone who records a false instrument. There is no easy administrative remedy for property owners who are victims of fraud.

The Ortiz scheme exploited the gap between those two backstops. Recording a lien is cheap and fast. The document immediately clouds title, which means the owner generally cannot sell or refinance until the cloud is removed. A lien for $24 million or $98 million would pause any sale, regardless of whether the underlying claim has any basis. A dishonest claimant who never intends to sue can simply record, wait, and let the pressure build on the owner to pay something to make the problem go away. Even after 90 days, when the lien is legally unenforceable, it remains on the record until someone takes affirmative steps to remove it.

According to the DA, Ortiz is alleged to have recorded 24 claims of mechanic’s lien and one grant deed against ten properties, claiming amounts from $800,000 to more than $98 million, for services such as “cleaning” and “consulting.” LAPD has stated that Ortiz is not licensed by the California Department of Real Estate and was promoting herself as a real estate consultant and business coach without a license.

If a property owner discovers a fraudulent lien on their title, they have several legal remedies, though each of them requires retaining counsel and incurring fees, and may be cumbersome.

The most direct option is a petition to release the lien under Civil Code section 8480. Once the 90-day foreclosure window has passed without a lawsuit, the owner can petition the superior court for an order releasing the lien, after first giving the claimant 10 days’ notice and an opportunity to release it voluntarily. This is the cleanest remedy when the claimant has simply let the lien go stale, which is often the case with a claimant who never intended to litigate in the first place.

Inside the 90-day window, an owner and their counsel can press the claimant to either file suit or release the lien, making clear that a claimant who records a lien and then fails to prosecute it exposes themselves to liability for attorney’s fees, costs, and potential tort damages.

For an owner who needs to sell or refinance immediately and cannot wait for a court proceeding, Civil Code section 8424 provides a mechanic’s lien release bond. A surety bond equal to 125 percent of the lien amount substitutes for the real property as security, which removes the lien from title and shifts any dispute to the bond itself. The approach is expensive, and at the face amounts recorded in the Ortiz matter, which ranged from $800,000 to nearly $100 million, the bond premium and collateral requirements may put this remedy out of reach for many owners. It remains an option worth evaluating with counsel when a transaction is at stake.

A knowingly false lien also supports a civil claim for slander of title. That cause of action allows the owner to recover the damages caused by the cloud on title, including the cost of clearing it and, in appropriate cases, punitive damages against a claimant who acted with malice. In a case involving dozens of liens recorded against unrelated owners, the pattern itself may support the malice element.

Owners should also report the matter as criminal fraud. Filing a false document is a felony under Penal Code section 115, the same statute under which Ortiz has been charged. LAPD’s Commercial Crimes Division operates a Real Estate Fraud Unit, and the Los Angeles County District Attorney maintains a dedicated Real Estate Fraud Section within its White-Collar Crime Division. 

Finally, every owner of Los Angeles County property should sign up for the County Registrar-Recorder’s property fraud alert system, which sends a free email notification whenever any document is recorded against a property the owner has registered. The service will not prevent a fraudulent filing, but it allows the owner to learn about the filing on the day it happens rather than months later when a sale or refinance is already in motion. Early notice materially shortens the timeline for obtaining relief and reduces the transactional damage a fraudulent lien can cause.

DA Ho has said his office will seek a court order to clear title on the affected properties as part of the criminal case. That is unusual and welcome relief for these specific victims, and it suggests an increasing willingness to treat title clearing as part of the criminal remedy rather than a separate civil burden for each homeowner.

The broader question is whether California should adjust the recording system to make this kind of abuse harder. Possible reforms include requiring a sworn declaration of contract existence at recording, requiring proof of contractor licensure for lien claimants who hold themselves out as providing services regulated by the Contractors State License Board, and imposing automatic penalties when a lien claimant fails to foreclose within 90 days. However, no action in Sacramento has focused on this issue yet. Senate Bill 255, which was passed in October 2025, requires every county to establish a recorder notification program and requires that all parties to a deed, quitclaim, mortgage, or deed of trust get a notification within 30 days of those documents being recorded. That will go into effect in January 2027, but would not affect mechanic’s liens.

On April 6, 2026, ABC reported that Marjorie Josaphat, one of the Benedict Canyon homeowners affected by the Ortiz scheme, was able to remove $100 million in mechanics liens filed by Ortiz’s company through a court action.

For now, the practical takeaway for Beverly Hills and Los Angeles property owners is to check title periodically and treat mechanic’s liens with urgency. 

Pooja S. Nair is a Partner and Chair of the Food, Beverage, and Hospitality Department at Ervin Cohen & Jessup LLP. She represents clients in real estate litigation and complex business disputes involving contracts, employment, intellectual property, and fraud. Her insights have appeared in Law360, Daily Journal, The New York Times, and the Los Angeles Times. Before joining ECJ, she led the Food and Beverage practice at TroyGould and practiced white-collar defense at Foley & Lardner. She also serves on nonprofit boards and has been recognized as one of Los Angeles’s Top Litigators and Trial Attorneys and Most Influential Women Lawyers by the LA Business Journal.

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On Oct. 6, 2025, Governor Newsom signed Assembly Bill (“AB”) 325, amending the Cartwright Act to directly address algorithmic price coordination. The law became effective Jan. 1, 2026, and makes California the most aggressive state in regulating pricing algorithms, across all industries. The legislation makes two specific practices illegal. First, it prohibits using or distributing a common pricing algorithm as part of an agreement to restrain trade. Second, it prohibits using or distributing such an algorithm if the person coerces another to adopt the recommended price or commercial term.

The proponents of AB 325 stated: “It doesn’t matter if price fixing happens behind closed doors or through artificial intelligence, it’s wrong either way. Californians face an affordability crisis, with basic needs like food and housing increasingly priced beyond their means. Unknown to consumers, digital tools are accelerating the “price crisis,” resulting in higher costs and fewer choices. AB 325 updates California’s antitrust laws to address modern technologies being used for illegal price fixing.”

AB 325 defines a common pricing algorithm as any methodology, including software or other technology, used by two or more persons that uses competitor data to recommend, align, stabilize, set, or otherwise influence a price or commercial term. This definition is deliberately broad. The statute does not distinguish between public and non-public competitor data, meaning that even algorithms using publicly available pricing information could violate the law if they facilitate coordination among competitors. The legislation applies across all industries operating in California, not just rental housing.

AB 325 also fundamentally changed how antitrust cases can be litigated in California. Previously, plaintiffs alleging price-fixing had to meet a high pleading standard, demonstrating facts that excluded the possibility that defendants were acting independently. Under the new law, plaintiffs need only show that the existence of a conspiracy to restrain trade is plausible. This relaxed standard makes it substantially easier for cases to survive early dismissal and proceed to discovery, where plaintiffs can obtain internal documents and communications that reveal coordination.

California paired this legislation with Senate Bill (“SB”) 763, which dramatically increases penalties for Cartwright Act violations. Criminal fines for corporations jumped from $1 million to $6 million per violation. Individual violators face penalties up to $1 million per violation, increased from $250,000. The Attorney General and district attorneys can seek civil penalties up to $1 million per violation. These penalties are cumulative, meaning they can be imposed in addition to other remedies available under California law.

The significance of this legislative framework came into focus even before the law took effect, as two large settlements were announced that dealt with algorithmic pricing. On Nov. 18, 2025, California Attorney General Bonta announced a $7 million settlement with property management company, Greystar Management Services LLC. As part of the settlement, Greystar agreed to stop using any software that uses competitively sensitive information to align rent prices.

On Nov. 24, 2025, the federal Department of Justice announced a settlement with RealPage for the company to change its business practices to cease having its software use competitors’ nonpublic, competitively sensitive information to determine rental prices in runtime operation and cease using active lease data for purposes of training the models underlying the software, limiting model training to historic or backward-looking nonpublic data that has been aged for at least 12 months.

The combination of new legislation, federal enforcement, and state prosecution creates new legal risk for landlords and other real estate companies using pricing algorithms. The practical implications extend beyond the real estate industry, as AB 325 can apply to any industry using algorithmic pricing. 

The legal landscape continues to evolve rapidly, with enforcement likely to intensify as prosecutors have additional tools in their arsenal to essentially catch up with technology. As artificial intelligence and machine learning become more prevalent in business operations, AB 325, and the federal and state enforcement mechanisms will govern a wide range of commercial activity. For businesses trying to set pricing with algorithms, the combination of AB 325’s broad prohibitions, dramatically increased penalties, and relaxed pleading standards creates substantial compliance obligations that require immediate attention. 

Pooja S. Nair is a Partner and Chair of the Food, Beverage, and Hospitality Department at Ervin Cohen & Jessup LLP. She represents clients in real estate litigation and complex business disputes involving contracts, employment, intellectual property, and fraud. Her insights have appeared in Law360, Daily Journal, The New York Times, and the Los Angeles Times. Before joining ECJ, she led the Food and Beverage practice at TroyGould and practiced white-collar defense at Foley & Lardner. She also serves on nonprofit boards and has been recognized as one of Los Angeles’s Top Litigators and Trial Attorneys and Most Influential Women Lawyers by the LA Business Journal.

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Homeowners’ associations or HOAs have become a dominant feature of the modern housing market, shaping both what communities look like and how people experience homeownership. According to CalMatters and Census Bureau data, 67% of all new single-family homes built in 2024 nationwide were in communities with HOAs, and California residents paid a median of $278 in monthly fees, among the highest in the nation. In many parts of California, buying into an HOA is the default for new homeowners, meaning that HOA obligations and limitations now operate along with more traditional obligations of property ownership.

HOAs in California are formed through private agreements but they exercise authority that directly affects how people use their homes and common areas in their neighborhoods or condominiums. HOAs exist through recorded declarations of covenants, conditions, and restrictions, along with bylaws and rules. HOAs are generally governed by HOA boards, which have the power to make sure their rules are followed, and to impose fines on homeowners who do not follow those rules. 

HOAs can govern a wide range of issues, including whether a homeowner may repaint a door, change landscaping, install solar panels, renovate a kitchen, rent out a unit, replace windows, park in a particular spot, or even keep certain items visible from the street. In many communities, HOAs also control access to shared amenities and impose mandatory monthly assessments.

AB 130 operates within the Davis-Stirling Common Interest Development Act (the “Act”), which provides the statutory foundation for HOA governance statewide. The Act governs elections, assessments, meetings, records, and enforcement authority. It was designed to create uniformity and predictability within the HOA governance system, and to provide a mechanism for homeowners to appeal certain HOA actions. 

AB 130 is a significant addition to the structure under the Act. AB 130 sets limits to the enforcement authority of HOAs. Enforcement actions, in which an HOA can levy fines or impose compliance demands on homeowners, are one of the most common sources of HOA conflict. Disputes frequently arise over architectural rules, landscaping requirements, alleged noise violations, pet restrictions, use limitations, or maintenance standards. Historically, these enforcement disputes often turned on informal practices and managerial discretion by the HOA, giving HOAs wide latitude in enforcing regulations.

AB 130 creates additional due process rights for homeowners in enforcement actions by their HOA and sets a limit on the amount of fines that can be imposed. Under the statute, an HOA generally cannot assess a fine of more than $100 per violation, except for health and safety regulations. 

The fee cap means that an HOA cannot use the threat of fines as a significant source of financial leverage against homeowners to ensure enforcement. HOA proponents claim that this cap on fines may result in homeowners choosing to ignore the rules because they can only be fined once for a maximum of $100. If a violation threatens health or safety, higher fines may still be permitted, but the association must have a defensible basis for that conclusion and must make required findings. 

Additionally, HOAs must give homeowners a meaningful opportunity to cure violations before they can impose any fines or take other disciplinary action. At least 10 days before any meeting to assess a fine, the HOA must notify the homeowner in writing, and provide the meeting’s date, time, location, and the nature of the violation and requested fine. Homeowners have the right to attend the meeting and speak to the HOA board. 

If a homeowner cures the violation before the meeting, the HOA cannot discipline the homeowner or impose any fine. If curing the violation would take longer than the time between the notice provided and the meeting, the homeowner makes a financial commitment to cure the violation, and if they do so, the HOA may not assess a fine or take any other disciplinary action. 

After a meeting, if the homeowner and HOA reach an agreement, they must create a written resolution signed by both parties, which is enforceable in court as long as it is consistent with the HOA’s governing documents and the law. If the homeowner and HOA do not agree, and the HOA imposes discipline or charges a fine, the board has to provide written notification of the decision within 14 days. 

AB 130 formalizes the process for HOA fees and fines and gives homeowners more due process opportunities to cure or challenge fines. Additionally, the cap on fines of $100 for the same violation limits an HOA’s ability to use fines as a hammer to ensure compliance with rules. The statute’s impact is especially relevant in communities with high property values and complex developments. In these communities, associations frequently oversee architectural standards, renovation approvals, and use restrictions. 

At its core, AB 130 rebalances the power between homeowner and HOA by making enforcement harder to impose quickly and more difficult to use as leverage. In communities where HOA rules meaningfully affect renovations, aesthetics, and the day-to-day experience of living at home, the changes will have a significant impact. 

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In 2023 and 2024, a series of antitrust class action lawsuits targeted NAR and real estate brokerages and brought NAR’s rules and practices under scrutiny. These lawsuits alleged that NAR’s industry practices and rules unlawfully restrained competition and inflated costs for home sellers. In a federal case in Missouri, Burnett v. NAR, a jury held unanimously that NAR and the defendant brokerages “knowingly and voluntarily” engaged in a conspiracy with the goal of “raising, inflating, or stabilizing broker commission rates paid by home sellers” by following and enforcing NAR’s “Cooperative Compensation Rule.”

The jury awarded $1.8 billion in damages, which could have been trebled to $5.4 billion. In March 2024, NAR announced that it would settle the lawsuit rather than appeal. However, one remaining corporate defendant, HomeServices of America, is still litigating the case and not part of the NAR settlement. As part of the settlement, NAR agreed to pay $418 million and to make some changes to its rules and practices to address the antitrust concerns raised in the lawsuit.

Those changes affect long-standing rules about how homes are marketed, and agents are paid. The above-mentioned Cooperative Compensation Rule had required listing brokers to offer compensation to buyer brokers through the Multiple Listing Service, or MLS. Critics argued that this locked in commission structures that consumers rarely questioned or negotiated. 

Under the settlement, those MLS-based compensation offers were eliminated. Sellers can no longer advertise buyer-broker commissions through Realtor-affiliated MLS systems, and buyer agents must now enter into written representation agreements with their clients before showing homes. These agreements are required to clearly disclose how the agent will be compensated and by whom. 

Changes from the NAR settlement are most noticeable for home buyers. Beginning in July 2024, an NAR rule requires MLS participants working with buyers to enter into written agreements with their buyers. As a result, buyers are now being asked to sign paperwork earlier, sometimes before touring a single property. They may be asked to discuss compensation with an agent before they have fully settled on whether they want representation at all. 

Open houses have also taken on a more structured tone. In many markets, including Beverly Hills, brokerages are increasingly careful to clarify that the agent hosting an open house represents the seller, not the buyer, unless a separate agreement is in place. Sign-in sheets, written disclosures, and explicit statements about agency relationships are becoming more common. 

Listing practices have shifted as well. Because compensation is no longer displayed on the MLS, buyers and their agents must gather information more deliberately. Conversations about whether a seller is willing to offer compensation to a buyer’s agent now occur off-MLS and are often tied to negotiation strategy. This has the potential to change how offers are structured and how services are priced, particularly as buyers compare what different agents offer and how they charge.

The settlement has also curtailed certain pre-marketing practices, such as extended “coming soon” listings that limit exposure to a narrow audience. These rules aim to promote broader access and reduce the perception that insiders receive preferential treatment. 

What has changed most significantly is not the dollar amount of commissions, but the timing and transparency of the conversations surrounding them. The settlement has forced compensation discussions to move from the background to the foreground of a transaction. This shift does not eliminate negotiation leverage or professional judgment, but it does require that both be exercised more openly, with fewer assumptions and clearer documentation. 

NAR’s recent strategic plan emphasizes transparency, local flexibility, and consumer trust. However, one year into the rule changes, the actual impact of the rule changes on Realtor commissions appears minimal. Redfin reported in August 2025 that the average buyer’s agent commission for homes sold in October 2025 was 2.34%, compared to 2.45% one year ago. 

The post NAR’s Antitrust Settlement Is Impacting the Residential Real Estate Market appeared first on Beverly Hills Courier.

On October 10, 2025, Governor Newsom signed into law a first-in-the-nation disclosure requirement for digital alteration of real estate marketing materials. Assembly Bill (“AB”) 723, which goes into effect on Jan. 1, 2026, requires licensed real estate brokers and salespersons to clearly disclose when an image used in real-estate marketing has been digitally altered, and makes it a criminal offense to fail to make this disclosure. 

AB 723 adds a new Section 10140.8 to the Business and Professions Code, which governs licensed real estate professionals. The law provides that a real estate broker, salesperson, or person acting on their behalf “shall include in the advertisement or promotional material a statement disclosing that the image has been altered and a link to a publicly accessible internet website, URL, or QR code that includes, and clearly identifies, the original, unaltered image. The statement shall be reasonably conspicuous and located on or adjacent to the image and shall include language indicating that the unaltered images can be accessed on the linked internet website, URL, or QR code.”

If a digitally altered advertisement or promotional material is posted on an internet website over which the real estate broker, salesperson, or person acting on their behalf, has control, they “shall include the unaltered version of the images from which the digitally altered images were created in the posting” by posting a link to a publicly accessible internet website that includes, and clearly identifies, the original, unaltered image.

The term “digitally altered image” is defined in the statute to mean an image “that has been altered through the use of photo editing software or artificial intelligence to add, remove, or change elements in the image, including, but not limited to, fixtures, furniture, appliances, flooring, walls, paint color, hardscape, landscape, facade, floor plans, and elements outside of, or visible from, the property, including, but not limited to, streetlights, utility poles, views through windows, and neighboring properties.” However, the definition does not include images where only lighting, sharpening, white balance, color correction, angle, straightening, cropping, exposure, or other common photo editing adjustments are made that do not change the representation of the real property. For example, the use of a filter to adjust lighting would not trigger the disclosure requirement.

If digitally altered photos materially mischaracterize a home, an affected consumer could have claims for misrepresentation or violations of California’s real estate licensing laws and ethical rules for real estate professionals, which prohibit deceptive advertising. AB 723 is meant to supplement rather than rewrite these underlying rules. 

The Assembly Bill Analysis of the bill states that: “[t]he end goal of including a disclosure and an unaltered version of, or link to, an image is to alert consumers to look at the image with a dose of skepticism. This bill would help protect California’s consumers shopping for real estate by enabling them to know whether or not what they see in advertisements is indeed real, or if they need to investigate the actual condition of the property further.” 

Opponents of the bill argued that it was unnecessary and duplicative of California law prohibiting false or misleading advertising in real estate, and that brokers and salespeople would already be subject to disciplinary action by the Department of Real Estate. 

AB 723 is part of a broader legislative push in California to regulate artificial intelligence. Recent laws include the California AI Transparency Act (Senate Bill 942), which also goes into effect on Jan. 1, 2026, and which requires covered providers to offer AI detection tools and include disclosures that certain content is AI-generated. In the entertainment context, recent California laws require informed consent by performers for AI-created digital replicas, and prohibit use of a deceased individual’s voice or image via AI without consent of their estate. 

AB 723 reinforces the established principle that real estate advertising is a representation with legal consequences. Given the increasing sophistication of AI tools and their capacity for altering reality, real estate purchasers will have another tool to review listings, and licensed real estate professionals will have a further disclosure responsibility. 

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SB 79 establishes statewide zoning standards for land within half a mile of a major publicly funded transit-oriented development (“TOD”) stop, which will override many local density and height restrictions and permit multiple-story projects of up to nine stories in areas that would otherwise remain limited to smaller structures. A TOD stop is defined as a major transit stop served by heavy rail transit, very high frequency commuter rail (72 trains per day across both directions), high-frequency commuter rail, light rail transit, or specified bus service within an urban county. The law provides Tier 1 zoning for heavy rail lines, and Tier 2 zoning for light rail lines and dedicated bus corridors. New developments in Tier 1 zones may be built 6 to 9 stories high, while new developments in Tier 2 zones may be built 5 to 8 stories high.

SB 79 was introduced on Jan. 15, 2025. It passed the Senate floor on June 3, 2025 by a 21-13 vote. It passed the Assembly floor on Sept. 11, 2025 and then passed a concurrence vote the following day. SB 79 follows a seven-year campaign by Senator Scott Wiener to push the bill forward after previous versions died in committee.

On June 23, 2025, Mayor Sharona Nazarian submitted an opposition to the State Assembly on behalf of the city of Beverly Hills. That opposition criticized SB 79’s shift away from locally-driven planning and delegation of zoning authority to transit agencies. She also stated that “in a built-out, compact city like Beverly Hills, SB 79 would have far-reaching and disruptive consequences,” and would undermine years of deliberate planning. SB 79 was also opposed by the League of California Cities and California State Association of Counties. The Los Angeles City Council also passed a resolution opposing the bill on March 28, 2025, similarly citing the need for local control and desire to preserve the character of local neighborhoods.

Supporters of the legislation, including Streets for All, claim that SB 79 will bring up to $1 billion to the city of Los Angeles alone due to projected increased property tax revenue from construction. YIMBY (“Yes in my backyard”) organizations contend that SB 79 addresses multiple statewide priorities, including supporting new housing, reducing car reliance, and maximizing infrastructure investments. 

Weiner stated that SB 79 “tackles the root causes of California’s affordability crisis by allowing more homes to be built near major public transportation stops and on land owned by transit agencies—bolstering transit use, slashing climate emissions, and supporting public transportation in the process.”

SB 79 builds on recent legislation attempting to streamline development, and particularly CEQA reforms signed into law on June 30, 2025, which created a new statutory CEQA exemption for infill housing development projects. Additionally, SB 423, also authored by Senator Weiner, extended SB 35 to continue a streamlined approval process for new affordable housing projects and expanded that to mixed-use projects.

The reduction in local control will be a challenge to Beverly Hills. The city has long exercised strict authority over zoning, design standards, and planning decisions, reflecting both community values and property market dynamics. SB 79 shifts that balance by permitting the imposition of state standards. While the city retains the option to adopt an alternative transit-oriented development plan, any such plan must meet or exceed the state’s housing targets and be approved by the Department of Housing and Community Development (“HCD”). 

The most immediate impact lies along Wilshire Boulevard due to the new stations on the Metro Purple Line at Wilshire/La Cienega and Wilshire/Rodeo. Parcels near these stations will become eligible for increased height and density allowances, which could enable development on a new scale for the city. 

Governor Newsom now has until Oct. 12 to sign or veto SB 79. If, as expected, it is signed into law, SB 79 will take effect on July 1, 2026. Starting on that date, SB 79 will require a housing development to be an allowable use on any site zoned for residential, mixed, or commercial development within one-half mile of a Tier 1 or Tier 2 TOD stop for cities with a population of at least 35,000, and one-quarter mile for cities with a population of less than 35,000 unless the local agency adopts an ordinance or local TOD alternative plan deemed compliant by HCD before July 1, 2026. 

Pooja S. Nair is a Partner and Chair of the Food, Beverage, and Hospitality Department at Ervin Cohen & Jessup LLP. She represents clients in real estate litigation and complex business disputes involving contracts, employment, intellectual property, and fraud. Her insights have appeared in Law360, Daily Journal, The New York Times, and the Los Angeles Times. Before joining ECJ, she led the Food and Beverage practice at TroyGould and practiced white-collar defense at Foley & Lardner. She also serves on nonprofit boards and has been recognized as one of Los Angeles’s Top Litigators and Trial Attorneys and Most Influential Women Lawyers by the LA Business Journal.

The post Controversial SB 79 Bill Awaits Newsom’s Signature appeared first on Beverly Hills Courier.

 The Courier has asked attorney Pooja S. Nair for a recap of this high-profile case and what is at stake at a critical hearing this fall. 

On June 23, 2025, Compass filed a federal antitrust lawsuit against Zillow in the Southern District of New York (Case No. 1:25-cv-05201). The lawsuit challenges the Zillow Ban, which Zillow has framed as its new Listing Access Standards designed to provide maximum information to homebuyers. 

According to the complaint (which cites Zillow’s own investor presentations), Zillow has 66% of the real estate audience share for the U.S. market, and 64% of the average daily app users. The Zillow Ban requires that any home that is publicly marketed be entered into a multiple listing service (MLS) and syndicated to Zillow within one business day. Failure to do so would result in the listing being blocked from appearing on Zillow and Trulia. The definition of a publicly marketed home is broad.

In the lawsuit, Compass describes its 3-phased marketing strategy, in which Compass provides a staging ground for listing. In phase 1, the listing is presented as a Compass Private Exclusive on Compass’ internal platform, only available to Compass agents. In phase 2, the listing moves to the “Coming Soon” phase, where it is posted to Compass’s public home search platform. In Phase 3, the listing is shared with the MLS database, and distributed to Zillow and other aggregators. The Zillow ban would make the first two phases of Compass’s marketing strategy obsolete in that any homes that were listed in Phase 1 and 2 would be banned from appearing on Zillow. Compass emphasizes that by eliminating those early phases, the Zillow Ban is stripping away at customer’s ability to test the waters in a more curated environment before launching into the wider marketplace.

Compass alleges that the Zillow Ban would make it hard “indeed nearly impossible for home sellers to sell their home outside of Zillow, in an effort to force all listings to be on Zillow where Zillow makes money selling leads off the homeowners’ listings.” It further alleges that the Zillow Ban makes it impossible for Zillow’s competitors to carry unique inventory and removes privacy benefits, because it forces homeowners to weigh the benefits of a private risking over the tremendous risk of never being able to list the property on Zillow.

Compass alleges that Zillow conspired with Redfin and eXp Realty to get those competitors to adopt and adhere to the Zillow ban. Compass further alleges in the Complaint that the Zillow Ban violates the antitrust laws by allowing Zillow to leverage its monopoly power to impose the Zillow ban on the market, and simultaneously entering into anticompetitive agreements with its competitors to do the same. Compass seeks a judicial declaration that Zillow’s conduct violates antitrust laws, and an injunction prohibiting Zillow from implementing and enforcing the Zillow ban, in addition to damages for Compass.

The case is before U.S. District Judge Jeannette A. Vargas in the Southern District of New York. After Compass quickly moved for a preliminary injunction and filed a motion to expedite discovery on June 27, 2025. The court approved an order for limited expedited discovery. On July 17, 2025, Zillow filed its opposition to the preliminary injunction.

Zillow’s opposition argues that “the antitrust laws do not permit Compass to force Zillow to deal with Compass on its preferred terms or support hidden listings which harms customers and Zillow.” Essentially, Zillow argues that the motivation of Compass’ lawsuit is about protecting its own hidden funnel, to the detriment of consumers. Zillow’s framing positions itself as a democratizer of real estate data, compared to Compass as an outdated entity focused on exclusivity.

The lawsuit is currently in the expedited discovery stage, with the parties trading arrows, designating experts, and engaging in heated discovery practice. Compass’ evidentiary hearing on the motion for preliminary injunction will be on November 18, 2025, and the hearing will be extremely hard fought. Between now and then, both sides will likely marshal economic experts, industry insiders, and competing visions of how the real estate marketplace should function. The litigation is already attracting close attention from industry professionals, who see it as a referendum on how much control one platform should wield over how homes are bought and sold.

The long-term implications of the lawsuit could have a major effect on Beverly Hills and other luxury markets, which have historically used tools such as office exclusives, whisper campaigns, and staged rollouts to market ultra-high-end properties where privacy matters. Under the Zillow Ban, those phased strategies would be eliminated because any public marketing would trigger the one-day MLS rule, and prevent the seller from ever using Zillow, making utilizing the Compass phase 1 and phase 2 tools prohibitively risky. This is because if a home does not sell in those phases, the homeowner could risk never having it listed to the wider Zillow audience.

This case also fits into the larger wave of antitrust challenges against digital platforms. Courts and regulators are already wrestling with whether companies like Google, Amazon, and Apple are misusing their roles as gatekeepers to stifle competition. Compass is essentially arguing that Zillow falls within the same category as tech giants whose control over market access has been  checked by the courts under the antitrust statutes. 

Over the next three months before Compass’s preliminary injunction hearing, the stakes remain high. For Compass, a win could preserve its phased strategy and limit Zillow’s influence over how the industry markets homes. For Zillow, victory would reaffirm its authority to set industry standards. However it is resolved, the Zillow Ban antitrust suit is a test case for the future of how real estate will be marketed, and its outcome will be especially influential in luxury markets. 

Pooja S. Nair is a Partner and Chair of the Food, Beverage, and Hospitality Department at Ervin Cohen & Jessup LLP. She represents clients in real estate litigation and complex business disputes involving contracts, employment, intellectual property, and fraud. Her insights have appeared in Law360, Daily Journal, The New York Times, and the Los Angeles Times. Before joining ECJ, she led the Food and Beverage practice at TroyGould and practiced white-collar defense at Foley & Lardner. She also serves on nonprofit boards and has been recognized as one of Los Angeles’s Top Litigators and Trial Attorneys and Most Influential Women Lawyers by the LA Business Journal.

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