City of Chula Vista
All You Need to Know About Building on Properties in Chula Vista Under SB-9
Using SB-9 to enhance property value in Chula Vista offers homeowners a valuable opportunity to secure funds to reduce their mortgage debt substantially. Moreover, if you have the means to add additional units, this can create rental income or accommodate extended family members while you remain in your primary home. To achieve a successful SB-9 project, it is essential to familiarize yourself with the eligibility requirements, understand how the regulations impact your property, and determine which SB-9 option provides the best financial benefit for your property.
What is SB-9 and how does it apply to the properties in Chula Vista city?
What is SB-9?
SB-9, also known as Senate Bill 9, is a recent state legislation aimed at increasing housing opportunities in California. It requires jurisdictions to ministerially approve two-unit developments on single-family residentially zoned lots and allows the splitting of single-family zoned properties into two lots, resulting in the potential development of up to four residential units. This streamlined process approves eligible requests without discretionary review, CEQA environmental analysis, or public hearings, provided certain development standards are met.
How does SB-9 apply to properties in Chula Vista?
In Chula Vista, SB-9 applies by allowing two-unit developments and urban lot splits on eligible properties. Local governments, including Chula Vista, need to create rules to implement SB-9's requirements, making it easier to add more housing units.
What can homeowners build under SB-9 or Chula Vista’s HOME Act?
Urban Lot Split under SB-9
An urban lot split divides an existing single-family zoned property into two new lots.
Under this option, you could have the following unit configurations:
Not sure if your property is located in a Single-family zoned area?
Two-Unit Residential Development under SB-9 (Duplex)
This refers to a housing project proposed within an area designated for a single-family zone, which includes no more than two residential units.
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?
The new units in a single-family zone can with a minimum size of 800 square feet. However, California’s SB-9 allows for units of any size.
Each lot allows the construction of two residential units, which may consist of ADUs and JADUs.
What are the setbacks?
For side and rear yard areas, the setback is at a maximum of four feet or the designated setback for that zone, whichever is less.
What are the lot constraints under SB-9?
Under SB-9, a lot should be at least 2,400 square feet to be split into two new lots, each capable of housing up to two units, totaling four units. Each new lot should be a minimum of 1,200 square feet and at least 40% of the original lot's size.
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 SB-9 are located in single-family residential zones. These include areas designated as R-E (Residential Estate Zone) and R-1 (Single-Family Residential Zone) according to the Chula Vista Municipal Code.
Can you disregard the environmental restrictions on the lot?
No. SB-9 does not apply to properties in environmentally sensitive areas. This includes wetlands, hazardous waste sites, floodways, conservation areas, or habitats for protected species. These restrictions are in place to secure these areas from potential harm due to development.
Can you bypass the Historical Preservation limitations?
No. Properties with historic designations are not eligible for SB-9. This means that if a property is designated as historic, it cannot take advantage of two-unit developments or urban lot splits.
Is it allowed to demolish an affordable unit?
SB-9 cannot be applied if developing the parcels requires demolishing or altering housing that has rent limits for moderate, low, or very low-income families.
Is it allowed to build on a property in Coastal Zones?
No. Housing development under SB-9 is not allowed on parcels that fall under certain prohibitions, including those located in coastal zones as defined by the Public Resources Code.
Is it allowed to build in High-Risk Areas?
It depends. Building in high-risk areas is generally discouraged. This includes properties in high fire hazard zones, earthquake fault zones, and areas prone to flooding (the 100-year flood zone). However, there may be exceptions for flood zones if they have special designations from FEMA or meet specific criteria outlined by the National Flood Insurance Program.
What are the limitations after completing a project using SB-9?
Does the homeowner need to reside on the property?
Yes, the homeowner should live on the property as their primary residence for at least 3 years, confirmed by a signed affidavit during the SB-9 application process. This requirement does not apply if there is no lot split involved.
What are the rental regulations?
Units should be rented for at least 30 days and cannot be used for short-term rentals, according to the Chula Vista Municipal Code.
Are existing tenants’ rights protected?
Yes, the City of Chula Vista’s SB-9 protects the rights of existing tenants. It prohibits demolishing or altering housing units that have been occupied by tenants within the three years before the application. Additionally, properties that have used the Ellis Act eviction in the past fifteen years are not eligible for SB-9. These rules are in place to protect current residents from being displaced.
Can condominiums be proposed as part of my Urban Lot Split application?
No, SB-9 allows property owners to split a single-family lot into two lots with up to two units on each, totaling four units. Condominiums involve a different ownership structure, requiring a Parcel Map process that includes filing fees, environmental assessments, public hearings, and appeals, unlike the streamlined process for SB-9 Urban Lot Splits.
What is the difference between SB-9 and SB-684?
SB-684 is a newer law that streamlines the approval process for constructing as many as 10 units on urban lots that are less than 5 acres in size. In contrast to SB-9, which is limited to single-family homes, SB-684 applies to multi-family districts and vacant lots in single-family neighborhoods. Furthermore, SB-684 does not enforce the ownership limitations that exist in SB-9 post-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 under SB-9 can qualify for ministerial approval, which expedites the housing development process by following clear, predefined standards. This straightforward method reduces administrative delays and allows for faster permit issuance without extensive environmental assessments (CEQA) or public hearings. However, the approval process for a lot split may still take as long as 1.5 years.
What are objective standards?
Objective standards, including “objective zoning standards,” “objective subdivision standards,” and “objective design review standards,” are criteria that do not involve personal opinions from officials. Instead, they depend on external benchmarks that can be verified consistently. These standards are known to both the developer and the official before the application is submitted.
What types of objective standards qualify for a waiver under SB-9?
In Chula Vista, certain objective standards can be waived under SB-9 if they make it difficult to build two units on a lot or prevent each unit from being at least 800 square feet. Examples include:
- Setbacks: Side and rear yard setbacks can be reduced to a maximum of four feet if a larger setback would stop a two-unit development from meeting size requirements.
- Parking Requirements: These can be waived if they would prevent the construction of two units that meet size requirements.
What are the steps to get the permits?
1. Check Eligibility: Review the Chula Vista Municipal Code to ensure the proposed development meets the necessary criteria, including housing type, zoning, historic districts, and environmental factors.
2. Submit Application: Prepare and apply the proposed development to the Development Services Department of Chula Vista.
3. Record Covenant: Before a building permit is issued, the property owner should record a covenant with the County Recorder’s Office. This document outlines occupancy requirements, unit details, rental restrictions, and other important information.
4. Comply with Subdivision Regulations: For urban lot splits, ensure compliance with all subdivision regulations, including parcel size, access to public roads, easement provisions, and recording a preliminary title report.
5. Denial: The Development Services Department can deny an application for various reasons, such as not meeting requirements, negatively impacting public health or safety, or failing to comply with applicable standards.
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 our initial scenario, we're considering the development of a new 4,000 square feet, 3-story duplex with a 1,000 square feet Accessory Dwelling Unit (ADU). The estimated total project cost, including construction, permit costs, and professional fees (excluding land acquisition), is $1,833,430. If this project were located in the Central Chula Vista area, a desirable neighborhood in the Chula Vista area, the market value of such a building would be approximately $2,745,000. As a result, the projected Return on Investment (ROI) for an SB-9 project in this neighborhood of the Chula Vista area is calculated as [($2,745,000 - $1,833,430)/$1,833,430]*100 = 50%
Scenario 2
Lot Split with 2 new 4,000 sq. ft 3-story Duplexes
In the second scenario, we're considering subdividing a lot and constructing two new 4,000-square-foot, 3-story duplexes. This project is expected to require an investment of $2,958,493, plus land acquisition costs if you don't already own the land.
In the Central Chula Vista area, a building of this size has an estimated market value of $4,392,000, resulting in an ROI of 48%. In contrast, if you invest in a different location in Chula Vista, such as the lower-end Rancho del Rey neighborhood, the market value of such a project is only $3,384,000, leading to a lower ROI.
Conclusion:
SB-9 projects in the Central Chula Vista area demonstrate strong returns on investment, indicating that it is worthwhile to consider undertaking a real estate project in this location. Conversely, an SB-9 project in the Rancho del Rey neighborhood carries the risk of an ROI below 50%. To mitigate this risk, you would need to take additional financial precautions or acquire the land at a very favorable price. Thus, while investments in Central Chula Vista seem promising, caution is advised for real estate ventures in Rancho del Rey.
See how much it will cost you to improve your property per SB-9
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