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What can you build on a real estate property under SB-9 San Francisco
Senate Bill 9 or SB-9 has opened multiple options for homeowners to add value to their property. Now it's up to the homeowner to decide which option works best for them. Important to remember is that you need to have a goal, either to achieve a certain profit or to create a new lifestyle for you and your family. In either case, you start by creating a Feasibility Study for each option. Here is how you can build a Feasibility Study for your SB-9 project.
Homeowners start with a Feasibility Study
Feasibility studies help you figure out if a project SB-9 is the right thing to do to reach your goals. This is what you need to do before paying a lot of money and wasting time:
- Property eligibility. SB-9 is a very exciting new law for homeowners and home buyers but not all single-family lots are eligible. So, first, you need to check if the property is eligible for SB-9.
- Understand the type of development you could build on your property considering your lot size and the existing building(s). Being allowed to build per zoning and having enough room to add building area on your lot, are two different things. This needs to be calculated.
- Choose the location of the new building(s) for each development option;
- Check if the calculated size of the new building(s) is enough for you to:
- get the ROI from renting or selling it
- host family and friends
- afford to build
- give you the market value to cover the construction costs
You can do all these things on your own or get it right away with your Development Analysis.
Once you have all these figured out, it's time to look for a team to help you complete the project. Going through these Steps before deciding to move on with your project will help you have a focused conversation with an architect, contractor, and lender. Choosing a realistic path will make you and your team have a positive experience going through this project.
Check if your property is eligible for SB-9, as not all single-family zoned lots qualify.
Now that you have your Feasibility Study started, let's look at a couple of options:
Two units + ADU
this is an SB-9 option for projects that do not use the Lot Split. An SB-9 project in this case could either demolish an existing single-family house and build a new duplex or convert the existing single-family structure into a duplex. This type of project does not require owner occupancy after project application (unlike those also pursuing a lot split). Neither unit would be subject to rent control, and the units could be sold as condominiums at project completion. Parcels of any size are eligible for SB-9 development without a lot split, and although there are no minimum or maximum unit sizes required by SB-9, the City must allow each unit to be at least 800 square feet. The Accessory Dwelling Units that may be added in this scenario are State Program Accessory Dwelling Units.
Two units + ADUs with Lot Split
SB-9 Parcel Development Scenarios for Projects that also use the Lot Split Provision. The second path for SB-9 development is to split a single-family lot into two lots. Both lots must be at least 1,200 square feet. Neither lot can be more than 60% of the size of the original lot. This type of project requires an affidavit from the applicant that they intend to occupy one of the housing units as their principal residence for a minimum of three years from the date of the approved lot split unless the applicant is a community land trust or a qualified nonprofit corporation. None of the primary units created on a parcel that was split under SB-9 is subject to rent control, and the units could be sold independently at project completion. The Accessory Dwelling Units that may be added in this scenario are State Program Accessory Dwelling Units.