Big Changes on the Horizon for California Real Estate
California is suffocating from a housing crisis that has only worsened due to COVID-19 and its economic impacts. The state's lack of affordable housing has created several scenarios: a mass out-of-state migration, a growing class of lower-income, commuters unable to find a house near their employment, rising eviction rates, and, finally, more homeless.
But that may be about to change.
On September 16th the California Senate passed into law SB-9 that will take effect January 1st, 2022. SB-9 could lead to the establishment of up to four homes on parcels where currently only one exists. The bill also allows single family parcels to be subdivided into two lots, while allowing for a new two-unit building to be constructed on the newly formed lot. Under SB-9, local agencies must approve certain subdivisions of one parcel into two without discretionary review or a hearing.
The bill is not a 'cure-all' for our housing problems, but it is a step in the right direction. That step, however, does come with certain exemptions. The bill requires acceptance of the local agency of the plan and the development or parcel to be subdivided must be located within an urbanized area. Further, the land cannot be on prime farmland, wetlands, high fire zone, land within a 100-year flood zone, or in a historic district.
SB-9 is a powerful tool for local governments to create a path to adding modest density to address our housing shortage. It preserves local control while also making it faster, less expensive, and less risky for a city to undertake a process to increase density in our neighborhoods.
Dennis Steinbach is the Broker of Record for EQ1 Real Estate. Visit us at The Property Bar located at 236 N. Santa Cruz Ave, Suite 102, Los Gatos, or email us at letsconnect@eq1re.com. www.eq1re.com
