City of Poway
All You Need to Know About Building on Properties in Poway Under SB-9
Using SB-9 for real estate improvements in Poway is a smart strategy for homeowners looking to secure funds to reduce their mortgage balance. If you have the means to expand with additional units, this approach can also create rental income or offer space for family members, all while you remain in your main home. To make the most of an SB-9 project, it's essential to familiarize yourself with the eligibility requirements, how regulations impact your property, and which SB-9 strategy will be financially advantageous for your Poway property.
What is SB-9 and how does it apply to the properties in Poway City?
What is SB-9?
SB-9, also known as Senate Bill 9, is a significant legislative initiative aimed at SB-9, known as Senate Bill 9, addresses housing affordability and availability. The process is streamlined through ministerial approval, enabling city officials to quickly approve qualifying requests without extensive reviews, environmental assessments, or public hearings, as long as specific development criteria are satisfied.
How does SB-9 apply to properties in Poway?
In Poway, SB-9 allows homeowners in single-family zones to construct up to two residential units on their property or split their lot into two lots. This means that a homeowner could potentially create four homes, including Accessory Dwelling Units (ADUs) or Junior Accessory Dwelling Units (JADUs). Additionally, Poway should ensure that any Urban Lot Splits comply with the standards outlined in SB-9.
What can homeowners build under SB-9 or Poway’s HOME Act?
Urban Lot Split under SB-9
Urban lot split allows homeowners to divide their single-family property into two separate 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 Residential Units under SB-9
Two residential units allow for the construction of up to two residential units on one property. This can involve building new structures or using existing ones.
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?
In Poway City's SB-9 regulations, if there is already a dwelling unit on the lot, any additional primary dwelling unit is limited to 800 square feet. However, California’s SB-9 allows for units of any size.
Each primary dwelling unit may be built along with one ADU or JADU.
What are the setbacks?
A minimum setback of 4 feet is required for interior side and rear yards, while front and street-side yards follow zoning standards. Structures should be at least 10 feet apart, except for legally allowed structures being replaced or converted, which don’t need a setback.
What is the parking requirement under SB-9?
Each lot needs at least one off-street parking space per unit.
What are the lot constraints under SB-9?
Proposed lots need to be at least 1,200 square feet, and no more than two units can be on each lot during an Urban Lot Split. The lots also cannot be smaller than 40 percent of the original lot area.
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?
To qualify for SB-9 development in Poway, properties should be in zoning areas designated for single-family homes, like RS-1 through RS-7 districts. However, some areas are not eligible, such as Rural Residential zones (RR-A, RR-B, and RR-C).
Can you disregard the environmental restrictions on the lot?
No. The city of Poway considers environmental restrictions, such as farmland, wetlands, hazardous waste sites, and conservation areas outlined in the Habitat Conservation Plan (HCP), when evaluating eligibility for housing development or lot splits under SB-9.
Can you bypass the Historical Preservation limitations?
No. Historical preservation areas, including designated historic districts or sites, are not eligible for housing projects under SB-9.
Is it allowed to demolish an affordable unit?
No. Under SB-9, you cannot demolish or change structures that contain affordable or rent-controlled housing. If a unit has had a tenant in the last 3 years, only up to 25 percent of the exterior walls can be demolished.
Is it allowed to build in High-Risk Areas?
It depends. Building in high-risk areas has certain restrictions under SB-9. While it may be possible to construct in these areas if it follows safety regulations, new developments are generally not allowed in specific high-risk zones, including high fire hazard areas, earthquake fault zones, and areas within a 100-year flood zone or floodway.
What are the limitations after completing a project using SB-9?
Does the homeowner need to reside on the property?
Yes. In Poway, the property owner is required to sign an affidavit confirming that the urban lot split will not violate the property's rules or Homeowner’s Association (HOA) restrictions. The property owner also has to declare their intention to live in one of the units as their primary residence for at least 3 years.
What are the rental regulations?
Rentals have to be for more than 30 days, focusing on long-term agreements.
Are existing tenants’ rights protected?
Yes. The rights of existing tenants are protected under SB-9. Developments cannot proceed if they involve demolishing or changing a unit that has had a tenant within the last three years.
Can condominiums be proposed as part of my Urban Lot Split application?
No. SB-9 permits a single-family lot to be split into two, allowing up to two units per lot, totaling 4 units. However, condominiums are not allowed in Urban Lot Splits due to their different ownership structure and the need for standard procedures like filing fees, environmental reviews, and public hearings, unlike SB-9's simplified process.
What is the difference between SB-9 and SB-684?
SB-684, a newer regulation, allows up to 10 units on urban lots smaller than 5 acres. While SB-9 focuses on single-family homes, SB-684 applies to multi-family zoning and vacant lots in areas typically reserved for single-family housing. SB-684 also lacks the ownership restrictions found in SB-9.
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, SB-9 projects may qualify for ministerial approval, which allows them to meet certain criteria that streamline the development process. This method reduces delays by bypassing lengthy environmental assessments and public hearings, though obtaining approval for a lot split may still take up to 1.5 years.
What are objective standards?
“Objective zoning standards," “objective subdivision standards," and “objective design review standards” refer to specific criteria that housing projects should meet for approval. Projects also need to follow the Best Management Practices Manual and other relevant rules. If a project falls under Priority Development Project standards, it may need extra approval from City Engineering staff for certain changes to stormwater facilities and strategies. Meeting these objective standards is important for getting ministerial approval under SB-9.
What types of objective standards qualify for a waiver under SB-9?
SB-9 allows waivers for certain standards, including:
1. Setback rules affecting existing buildings that limit the addition of two units.
2. Side and rear setback requirements of more than 4 feet that prevent the construction of two units.
What are the steps to get the permits?
To get permits for an SB-9 development or Urban Lot Split in Poway, follow these steps:
1. Hire a designer or architect to create building plans that meet the application guidelines set by the City of Poway.
2. Submit four copies of the plans along with the application and pay any necessary plan check fees.
3. Make any required corrections during the plan check reviews until the application is ready for approval.
4. After the building permit is approved, pay the relevant issuance and impact fees.
For an Urban Lot Split, there are additional steps:
1. Have an engineer prepare civil drawings for submission.
2. Submit a ministerial Tentative Parcel Map (TPM) along with the required fees.
3. Complete the process by submitting a Final Map.
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 scenario, we're looking at developing a 4,000-square-foot, three-story duplex with an added 1,000-square-foot Accessory Dwelling Unit (ADU). The total estimated expense for this project, covering construction, permits, and professional fees (not including land costs), is $1,834,076. In the desirable Old Coach area of Poway, the completed property's market value is projected to be around $3,160,000. This results in a projected Return on Investment (ROI) of 72%, calculated as [($3,160,000 - $1,834,076)/$1,834,076]*100 = 72%
Scenario 2
Lot Split with 2 new 4,000 sq. ft 3-story Duplexes
For this scenario, we plan to split a lot and build two new 4,000-square-foot, three-story duplexes. The estimated total investment for this project is $2,965,096, not including any land acquisition costs.
In the Old Coach area, the anticipated market value for this project is $5,056,000, which results in an ROI of 71%. However, if the project were located in a different part of Poway, such as the more budget-friendly Ann-O-Reno neighborhood, the market value would be around $2,968,000, leading to a much lower ROI.
Conclusion:
SB-9 projects in the Old Coach area offer attractive returns on investment, making it a worthwhile location for real estate development. In contrast, projects in the Ann-O-Reno neighborhood may face nearly negative returns, making them riskier. To reduce this risk, consider additional financial strategies or securing the land at a particularly advantageous price. Thus, while Old Coach shows great potential, it’s wise to proceed with caution in Ann-O-Reno.
See how much it will cost you to improve your property per SB-9
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