CA AB1406

Increases the liquidated damages threshold for initial sales of newly constructed attached condominium units (in structures of 10+ units) from 3% to 6% of the purchase price before additional accounting requirements apply to sellers

Requires sellers to perform an accounting of construction and sale costs within 60 days after final close of escrow when liquidated damages exceed 6% of purchase price, and refund any excess amounts to defaulting buyers

Applies specifically to attached residential condominium units as defined in Civil Code Section 783, within structures containing 10 or more units

Maintains existing requirement that sellers make reasonable efforts to mitigate damages arising from buyer defaults

Introduced by Assembly Members Ward, Wicks, and Wilson; amended multiple times between March 2025 and January 2026