City of Carlsbad
All You Need to Know About Building on Properties in Carlsbad Under SB-9
Using SB-9 to enhance property value in Carlsbad offers homeowners a great way to secure funds for paying down a substantial part of their mortgage. Moreover, if you can build additional units, it can create rental income or offer accommodations for extended family members while you remain in the main residence. To achieve a successful SB-9 project, begin by grasping the eligibility requirements, the specific restrictions for your property, and the most financially sensible SB-9 option for your property.
What is SB-9 and how does it apply to the properties in Carlsbad City?
What is SB-9?
Senate Bill 9 (SB-9) streamlines the approval process for certain housing projects in California. Local authorities are encouraged to expedite these developments, bypassing the need for extensive environmental reviews (CEQA), conditional use permits, or approvals from agencies like the Planning Commission or Historic Preservation Commission. While participation is not mandatory, specific criteria must be met to qualify.
How does SB-9 apply to properties in Carlsbad?
In Carlsbad, SB-9 allows for the construction of two residential units on existing single-family lots, which may include urban lot splits. This legislation simplifies the approval process for eligible housing projects, helping to address the housing crisis and promoting higher-density development. It facilitates the addition of more units while ensuring compliance with requirements like minimum lot sizes and zoning laws.
What can homeowners build under SB-9 or Carlsbad’s HOME Act?
Urban Lot Split SB-9
This option allows property owners to split a single-family lot into two lots and place up to two units on each newly created lot, potentially resulting in up to four units.
Under this option, you could have the following unit configurations:
Not sure if your property is located in a Single-family zoned area?
Single Lot Duplex under SB-9
This option allows property owners to construct two residential units on a parcel zoned for single-family housing, essentially creating a duplex.
Under this option, you could have the following unit configurations:
How large can each new unit be, and how many can you have per lot?
Under the SB-9 California HOME Act, there are no set size limits for new units, meaning they can vary widely. However, if developers request exceptions to certain design standards from the city, the law requires that each unit should have at least 800 square feet of floor area.
Each lot allows for the development of two housing units, which can include ADUs and JADUs.
What are the setbacks?
The minimum setback from the side and rear of the property is less than 4 feet.
What is the parking requirement under SB-9?
Under SB-9, at least one off-street parking space may be required for each unit in a housing development, unless the parcel is located within one-half mile walking distance of a high-quality transit corridor/major transit stop, or there is a car share vehicle located within one block of the parcel.
What are the lot constraints under SB-9?
For an urban lot split, each newly created lot should be at least 40% of the original lot size, ensuring a minimum area of 1,200 square feet. Additionally, each lot needs an access point to a public right-of-way, either through frontage or easement, with a required minimum width of 20 feet.
Development Analysis calculates the max size under SB-9 for the highest return.
Who and which properties are eligible for SB-9 or the HOME Act?
Which zoning designations are eligible for SB-9?
Properties eligible for Carlsbad’s SB-9, as outlined in the California HOME Act (SB-9), include those zoned R-A, R-E, or R-1 within urbanized areas or clusters.
Can you disregard the environmental restrictions on the lot?
No. The SB-9 legislation includes specific eligibility criteria and restrictions, including zoning regulations and environmental considerations like hazardous waste sites, and protected habitats.
Can you bypass the Historical Preservation limitations?
No. The property should not be in a designated historic district or listed as historic property on the State Historic Resources Inventory. It also cannot be on a site marked as a landmark or historic property by local ordinances.
Is it allowed to demolish an affordable unit?
No. The SB-9 California HOME Act does not allow the demolition of affordable units. The project cannot involve demolishing or altering housing intended for moderate, low, or very low-income households, or housing that has had a tenant in the last three years. Additionally, the development cannot demolish more than 25 percent of the existing exterior walls unless the property has been vacant for over three years.
Is it allowed to build on a property in Coastal Zones?
Possibly. SB-9 allows building on coastal-zoned properties, but any development needs to comply with the California Coastal Act, which may have additional restrictions.
Is it allowed to build in High-Risk Areas?
Yes. Building in High-Risk Areas, including zones with high fire hazards, earthquake fault zones, or areas within a 100-year floodplain, is allowed under SB-9, as long as the new development follows the city's fire hazard mitigation measures and ignition-resistant construction standards.
What are the limitations after completing a project using SB-9?
Does the homeowner need to reside on the property?
Yes, homeowners should sign an affidavit confirming their intention to occupy one of the units as their primary residence for at least 3 years after the lot split is approved. This requirement does not apply to community land trusts or qualified nonprofit corporations.
What are the rental regulations?
Short-term rentals, like vacation rentals, for units created under SB-9 are not allowed. The minimum lease term for these units is at least 30 days.
Are existing tenants’ rights protected?
Yes, existing tenants' rights are protected under SB-9. The law prevents the demolition or alteration of housing units that have had a tenant in the last three years. Additionally, property owners cannot withdraw accommodations from rent or lease for 15 years under the Ellis Act. These rules help protect tenants from being displaced.
Can condominiums be proposed as part of my Urban Lot Split application?
No, condominiums cannot be included in the Urban Lot Split application. SB-9 allows property owners to split a single-family lot into two and build up to two units on each, totaling four units.
Condominiums involve common ownership of land and buildings, requiring a more complex Parcel Map process with additional fees and assessments, unlike the streamlined SB-9 procedure.
What is the difference between SB-9 and SB-684?
SB-684 is a more recent law that simplifies the process for building up to 10 units on urban properties smaller than 5 acres. Unlike SB-9, which focuses only on single-family residences, SB-684 pertains to multi-family zones and unoccupied lots in single-family areas. Additionally, SB-684 does not impose the ownership constraints that are present in SB-9 after development.
Below we compared SB-9 and SB-684 for you to understand the development framework outlined by each bill.
How to get permits under SB-9 or the HOME Act?
Does SB-9 projects qualify for a ministerial approval process and what does it mean?
Yes, projects that fall under SB-9 can use a ministerial approval process. This method streamlines housing development by offering clear and consistent guidelines. Unlike subjective approaches, ministerial approval relies on specific criteria, minimizing bureaucratic delays. Consequently, projects can obtain permits without extensive CEQA reviews or public hearings. However, securing approval for a lot split may still take as long as 1.5 years.
What are objective standards?
“Objective zoning standards," “objective subdivision standards," and “objective design review standards” are streamlined and unbiased review processes for proposed housing developments. These standards function as measurable criteria for evaluating proposals, eliminating the influence of personal opinions or biases. This ensures consistency and predictability in the application review process of SB-9.
What types of objective standards qualify for a waiver under SB-9?
Under SB-9, standards that physically restrict the construction of units at least 800 square feet can be waived if it is shown that these standards prevent building either of the two required units.
What are the steps to get the permits?
1. Eligibility Check: Confirm that your project meets SB-9 criteria for either a Single Lot Duplex or an Urban Lot Split. Check zoning, location, and other requirements in the law.
2. Prepare Documentation: Collect all necessary documents, including the SB-9 Eligibility Checklist (B-74) and either the Residential Building Permit Application (B-1) for a Single Lot Duplex or the Development Permit Application (P-2) for an Urban Lot Split.
3. Submit Permit Applications: Submit the appropriate permit applications along with the completed SB-9 Eligibility Checklist. Ensure all required information is provided accurately.
4. Review Process: The city will review your applications to confirm compliance with objective zoning, subdivision, and design review standards set by SB-9. Applications that meet these standards are processed quickly without discretionary review, CEQA analysis, or public hearings.
5. Parcel Map Standards: For Urban Lot Splits, make sure the proposed subdivision follows all relevant objective requirements of the Subdivision Map Act and city ordinances, including lot size, access, and parcel restrictions.
6. Annual Reporting: The city should report all urban lot splits in its Annual Housing Progress Report to the California Department of Housing and Community Development (HCD) as required by SB-9.
How fast can you complete a project per SB-9?
This information outlines the different phases of the project along with their respective durations.
Feasibility Study with deciding the final scope of the project:
- Maximum of 3 days using CityStructure Analysis
Secure Financing: 2 to 3 weeks
Hiring the Team: 2 weeks
Design Process:
- Schematic Design: 1-2 months
- Permit Set / Design Development Drawing Set: 2-3 months
- Construction Drawing Set: 2-3 months
Entitlements and Building Permits: 9 to 15 months with the possibility of extending further due to departmental backlogs
Construction:
- Lot Split only: 1 year
- Single Family House/Duplex: 1 year
- Accessory Dwelling Unit (ADU): 3 to 6 months
How much does an SB-9 project cost?
This analysis will examine two scenarios to evaluate expected expenses, property valuations, and potential profits for real estate projects.
Scenario 1
New 4,000 sq. ft 3-Story Duplex + 1,000 sq. ft ADU
In this initial scenario, we envision a project involving the construction of a 4,000-square-foot, three-story duplex, along with a 1,000-square-foot ADU. The total estimated cost, including construction, permits, and professional fees (excluding land purchase), is $1,829,697. If located in La Costa Oaks, a desirable neighborhood in Carlsbad, the market value of the completed property would be approximately $4,565,000. Consequently, the ROI for an SB-9 project in this area is calculated as [($4,565,000 - $1,829,697)/$1,829,697]*100 = 150%
Scenario 2
Lot Split with 2 new 4,000 sq. ft 3-story Duplexes
In the second scenario, we propose subdividing a lot and constructing two new 4,000-square-foot, three-story duplexes. The projected investment for this development is $2,959,136, excluding land acquisition costs if applicable.
In La Costa Oaks, the market value of such a project is estimated at $7,304,000, yielding a 150% ROI. However, in a less upscale Carlsbad neighborhood like Calavera Hills, the market value decreases to $5,168,000, resulting in a lower ROI.
Conclusion:
SB-9 projects in La Costa Oaks demonstrate high returns on investment, making it an attractive area for real estate development. Conversely, Calavera Hills, while offering a lower ROI, still provides a profitable investment opportunity for SB-9 projects.
See how much it will cost you to improve your property per SB-9
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