California housing prices have continued to increase for years for many reasons, but the main one is that more people want housing than is available. This is true for both home ownership and rental housing. In an effort to address this problem, on September 16, 2021, Governor Newsom signed Senate Bill 9 (known as the Housing Opportunity and More Efficiency Home Act) that changed residential zoning and development laws. As a general statement, the Act allows a homeowner to (i) subdivide their current residential parcel into two residential parcels, and (ii) build two residential units on each parcel, subject to many conditions and restrictions contained in the Act. This is a complicated piece of legislation and this article is meant only to give the broad parameters of the Act.
The Act became effective January 1, 2022. The first part addresses a homeowner’s ability to have two residential units on a single legal parcel. Previous law permitted a jurisdiction to zone an area as only allowing one single family residence on each legal parcel. In general, the Act changed the law such that a homeowner can now have two residences on a single parcel, but subject to numerous conditions. For example, a homeowner can only do this if they live in an “urbanized area” or “urban cluster.” The U.S. Census Bureau defines an “urbanized area” as a city with at least 50,000 people and an “urban cluster” as an unincorporated area with at least 2,500 people and less than 50,000 people. In addition, any such development cannot result in the demolition or alteration of any housing that (i) is subject to a covenant, ordinance or law that restricts the housing to use by moderate, low or very low income individuals or families, (ii) is subject to any rent control or price control, or (iii) has been occupied by a tenant for the past 3 years (regardless of their income level).
The Act also address a homeowner’s ability to do a lot split, but again subject to numerous requirements. For example, all of the restrictions detailed above apply equally to any proposed lot split. In addition, the lot split can only create two new legal parcels that must be of approximately equal size. No new lot can be smaller than 1,200 square feet. The property cannot be located in a historic district or be in the State Historic Resources Inventory. Also, no adjacent parcel can have been subdivided under the Act.
The discussion above only provides a sample of the various conditions and requirements that apply to any homeowner that wants to take these actions. A homeowner should consult with legal counsel to understand their rights and options under the Act.
This article is written by Patrick Casey, who is a business attorney with the JRG Attorneys At Law firm in Monterey. You may reach the author at (831) 269-7114 or at patrick@jrgattorneys.com.
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