Rancho Palos Verdes
All You Need to Know About Building on Properties in Rancho Palos Verdes Under SB-9
Using SB-9 for real estate endeavors in Rancho Palos Verdes City is an effective strategy for homeowners to secure funds to pay down a substantial part of their mortgage. If you have additional resources, you can construct extra units to generate rental income or accommodate family members while remaining in your primary residence. To ensure the success of an SB-9 project, start by verifying your property's eligibility, comprehending the applicable regulations, and choosing the SB-9 option that provides the greatest financial advantage for your property.
What is SB-9 and how does it apply to the properties in Rancho Palos Verdes City?
What is SB-9?
SB-9, or Senate Bill 9, aims to simplify the approval process for certain housing developments in California. It encourages local officials to speed up the approval of these projects through a special pathway, avoiding extensive environmental reviews (CEQA), Conditional Use Permits, or similar approvals from agencies like the Planning Commission. Joining this program is voluntary and depends on meeting specific criteria.
How does SB-9 apply to properties in Rancho Palos Verdes?
SB-9 encourages homeowners to split single-family lots into two, allowing for the construction of up to two units on each new lot. Therefore, homeowners can potentially build a total of four units on properties intended for single-family homes.
What can homeowners build under SB-9 or Rancho Palos Verdes’ HOME Act?
Urban Lot Split under SB-9
An urban lot split involves dividing a single property in an urban area 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-Unit Development/ Second unit under SB-9
A Two-Unit Development involves building up to two residential units in a single-family residential zone.
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 a two-unit development, each new unit can be up to 800 square feet, regardless of other rules. If the lot is at least 20,000 square feet, units can expand to a maximum of 1,000 square feet. However, under California's SB-9, units can be of any size without limitations.
A maximum of two units is allowed on each lot, containing both ADUs and JADUs.
What are the setbacks?
For new construction, both units in a two-unit development should maintain a minimum setback of 4 feet from the side and rear property lines. However, no setbacks are required for existing structures or units that are built in the same location and dimensions as the existing ones.
What is the parking requirement under SB-9?
Each unit needs to provide one new off-street parking space, either enclosed or open. This is in addition to any existing parking spaces on the property.
Exceptions apply: no extra parking is required if the parcel is within half a mile of a high-quality transit corridor or major transit stop, or if there is a car share vehicle within one block.
What are the lot constraints under SB-9?
Each new lot should be at least 1,200 square feet and cannot be smaller than 40% of the original lot size.
Flag lots are prohibited if the original lot borders an alley or is a corner or through lot. If a detached second unit cannot be built behind the main residence due to legal or physical issues, it may be placed in front or beside it, provided it is smaller in height and width than the primary home, with a required front setback of at least 25 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 SB-9 are located within the RS zoning district.
Can you bypass the Historical Preservation limitations?
No, developments cannot be located within a historic district or on properties listed in the state historic resources inventory. They also cannot be in areas designated as city or county landmarks or historic properties according to local regulations.
Is it allowed to demolish an affordable unit?
No, SB-9 projects cannot require the demolition or alteration of housing units that have affordability restrictions. These restrictions may be set by covenant, ordinance, approval conditions, or other legal agreements.
Is it allowed to build on a property in Coastal Zones?
Yes, building is allowed in coastal zones. However, as part of the SB-9 development approval, applicants need to follow the requirements outlined in Chapter 17.72 of the city’s municipal code, which deals with Coastal Permits. These requirements are similar to those for applying for a parcel map.
Is it allowed to build in High-Risk Areas?
Possibly. In Rancho Palos Verdes, properties cannot be located in landslide moratorium zones unless the proposed project meets certain exception criteria. If applicable, applicants need to get a permit for an exception to the landslide moratorium before they apply for an SB-9 development.
What are the limitations after completing a project using SB-9?
Does the homeowner need to reside on the property?
Yes, the homeowner is required to live in one of the units created by the urban lot split as their primary residence for at least 3 years from the date of approval. This rule does not apply if the parcel owner is a "community land trust" or a "qualified nonprofit corporation."
What are the rental regulations?
The property cannot be rented for less than 31 consecutive days, which is considered a short-term rental.
Are existing tenants’ rights protected?
Yes, existing tenants are protected. Rules are in place to prevent actions that would lead to the demolition or alteration of certain types of housing. This includes housing that is under rent or price control by a public entity, properties where accommodations have been removed by the owner within the last 15 years, and housing occupied by tenants in the past 3 years.
Can condominiums be proposed as part of my Urban Lot Split application?
No, SB-9 allows homeowners to split a single-family lot into two and create up to two units on each lot, totaling four units. Condominiums work under a different ownership model that includes both land and building ownership, along with individual unit ownership. Establishing condominiums requires traditional processes like filing fees, environmental assessments, public hearings, and appeal periods, which differ from the simpler process for SB-9 urban lot splits.
What is the difference between SB-9 and SB-684?
SB-684 is a newer law that allows the creation of up to 10 housing units on urban lots less than 5 acres, applicable to multi-family zones and empty lots in single-family areas. On the other hand, SB-9 restricts development to single-family properties and enforces ownership limitations after the construction process, providing fewer possibilities for 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 obtain ministerial approval. This process simplifies housing development by establishing straightforward and uniform guidelines. Unlike more subjective approaches, ministerial approval is based on specific, established criteria, reducing bureaucratic hold-ups. As a result, projects can secure permits without the extensive environmental assessments (CEQA) or public meetings typically required. However, even with this expedited process, getting approval for a lot split can still take as long as 1.5 years.
What are objective standards?
"Objective zoning standards," "objective subdivision standards," and "objective design review standards" are clear rules used in zoning and design reviews. These standards eliminate personal judgments by officials and are based on measurable and publicly available criteria. This ensures consistency and reliability in evaluating projects, giving homeowners clear guidelines for their proposals.
What types of objective standards qualify for a waiver under SB-9?
1. Setback waivers for distances greater than 4 feet: SB-9 allows for exceptions to rules requiring setbacks that surpass 4 feet from the side and rear property lines, as these can limit the ability to construct two units.
2. Waivers for other objective criteria: SB-9 can also grant waivers for additional objective standards that might hinder the development of two units on a property.
What are the steps to get the permits?
1. Check for an Existing Primary Dwelling Unit: Confirm there is one primary dwelling unit on the property that has a valid occupancy certificate or a completed building permit.
2. Submit an Individual Property Owner Application: Only the property owner listed on the title deed can apply for an urban lot split.
3. Go Through the Ministerial Approval Process: The application is reviewed without any discretionary hearings. Approval is based solely on meeting the specified criteria.
4. Receive the Director's Decision: The director will review the application and either approve or deny it. Anyone interested in the decision can appeal to the planning commission and then to the city council if needed.
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: 6 to 9 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 plan, we recommend constructing a three-story duplex with a combined area of 4,000 square feet, along with a 1,000-square-foot Accessory Dwelling Unit (ADU). The total estimated cost, covering construction, permits, and professional fees (excluding land costs), is $2,152,674. The projected market value of the completed property in Rancho Palos Verdes is approximately $4,500,000, resulting in an ROI of [($4,500,000 - $2,152,674)/$2,152,674]*100 = 109%
Scenario 2
Lot Split with 2 new 4,000 sq. ft 3-story Duplexes
In the second plan, we propose dividing a lot and constructing two separate three-story duplexes, each with an area of 4,000 square feet. The total projected investment for this development, excluding land acquisition costs, is $3,454,617. The anticipated market value for these duplexes in Rancho Palos Verdes is $7,200,000, leading to an ROI of 108%.
Conclusion:
SB-9 developments in Rancho Palos Verdes provide high returns on investment, positioning the city as a prime and lucrative area for real estate projects.
See how much it will cost you to improve your property per SB-9
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