City of Walnut
All You Need to Know About Building on Properties in Walnut Under SB-9
Using SB-9 for real estate projects in Walnut City is a great way for homeowners to get cash to pay off part of their loan, add rental units, or accommodate extended family while staying in their main home. To succeed with SB-9, homeowners should understand eligibility, property rules, and which SB9 option is the best financial choice for their property in Walnut City.
What is SB-9 and how does it apply to the properties in Walnut City?
What is SB-9?
SB-9, or Senate Bill 9, is a California law aimed at addressing the housing shortage. It lets property owners split single-family lots into two separate parcels and build up to two homes on each lot, allowing for a total of four housing units on the original lot. This law simplifies the approval process by removing the need for detailed environmental reviews and discretionary permits, as long as specific conditions like lot size and zoning are met.
How does SB-9 apply to properties in Walnut?
SB-9 affects properties in Walnut by making it easier to develop additional housing. It allows the division of single-family lots into two, which could increase housing availability. This could address housing shortages and offer opportunities for property owners or developers to enhance property value.
What can homeowners build under SB-9 or Walnut’s HOME Act?
Urban Lot Split under SB-9
An urban lot split involves dividing a single lot into two, in areas designated for single-family homes.
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 under SB-9
A two-unit development involves building two separate homes on a single lot zoned for single-family use.
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 Walnut, studios and one-bedroom units should be at least 500 square feet, while units with more than one bedroom need to be at least 700 square feet. The largest size allowed for new homes is 800 square feet. Existing homes that are already 800 square feet or more cannot be expanded. However, the state of California SB-9 allows for any size of the unit.
Each lot allows for the development of two housing units, which can include ADUs and JADUs.
What are the setbacks?
The specific setback requirements are as follows: a front setback of 20 feet, an interior side setback of 5 feet, a street side setback of 10 feet, and a rear setback of 15 feet.
What is the parking requirement under SB-9?
Each new primary dwelling unit under SB-9 should have one off-street parking space unless certain conditions are met. These exceptions include if the lot is within a half-mile walking distance of a high-quality transit corridor or a major transit stop, or if it is within one block of a car-share vehicle location.
What are the lot constraints under SB-9?
An urban lot split should divide an existing lot into no more than two new lots of roughly equal size. One of the new lots cannot be smaller than 40% of the original lot's area, and both new lots should be at least 1,200 square feet each.
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 in Walnut's single-family zones are eligible for SB-9.
Can you disregard the environmental restrictions on the lot?
No, environmental restrictions need to be followed. This includes regulations related to farmland, wetlands, hazardous waste sites, and conservation areas.
Can you bypass the Historical Preservation limitations?
No, you cannot bypass historical preservation limits. A property cannot be in a historic district or listed on the State Historic Resources Inventory.
Is it allowed to demolish an affordable unit?
No, demolishing or altering low-income housing is not allowed. SB-9 protects affordable housing units that are governed by laws or ordinances related to rental affordability for moderate, low, or very low-income families.
Is it allowed to build in High-Risk Areas?
Maybe. Building in high-risk areas like fire hazard zones, flood zones, and earthquake fault lines is generally restricted. However, it might still be possible if the project meets specific guidelines to reduce risks associated with these hazards.
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 on the property. Before splitting an urban lot, they need to sign a statement confirming they will occupy one of the units as their primary residence for at least 3 years after the split is approved.
What are the rental regulations?
Rentals on the property need to have lease terms longer than 30 consecutive days.
Are existing tenants’ rights protected?
Yes, SB-9 protects tenants. It prevents demolishing or altering rent-controlled or regulated homes and those with tenants in the past three years. The property also cannot remove units from the rental market under the Ellis Act in the last 15 years, and projects must avoid demolishing more than 25% of the exterior walls.
What is the difference between SB-9 and SB-684?
SB-684, a newer law, allows the development of up to 10 units on urban properties smaller than 5 acres. In contrast to SB-9, which focuses on single-family homes, SB-684 applies to multi-family areas and vacant lots in single-family zones. Additionally, SB-684 does not include the ownership limitations present in SB-9’s guidelines.
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 can qualify for ministerial approval, accelerating the development process by adhering to set criteria. This method reduces administrative delays, allowing for faster approvals without the need for extensive environmental assessments (CEQA) or public meetings. However, even with this expedited approach, it might still take up to 1.5 years to finalize approval for a lot split.
What are objective standards?
Objective standards, such as "objective zoning standards," "subdivision standards," and "design review standards," aim to remove personal judgment from decision-making. These standards rely on clear, measurable criteria that developers and officials can refer to before submitting plans. This helps ensure consistency, giving homeowners transparent and predictable rules to follow when proposing projects.
What types of objective standards qualify for a waiver under SB-9?
In Walnut, SB-9 allows waivers for specific planning, zoning, and subdivision regulations. These waivers are granted when adhering to these standards would block the construction of two units on a lot or prevent either unit from being at least 500 square feet in size.
What are the steps to get the permits?
To get permits under SB-9 in Walnut, follow these steps:
1. Learn Local Rules: Review Walnut’s Planning and Zoning rules, as well as guidelines for housing projects and accessory units.
2. Check Statewide Regulations: Ensure your project aligns with statewide laws, including those that affect charter cities.
3. Verify Compliance: Make sure your proposal follows rules on rent control, demolition limits, site restrictions, and historic areas.
4. Prepare Documents: Collect the required paperwork for your housing development or lot split.
5. Submit Application: Send your application to the planning department for ministerial approval.
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 first scenario, we recommend constructing a three-story duplex with a total area of 4,000 square feet, complemented by a 1,000-square-foot Accessory Dwelling Unit (ADU). The estimated total expenditure, including construction, permits, and professional fees (excluding land), is $2,185,813. The projected market value for the completed property in Walnut is approximately $3,000,000, leading to a return on investment (ROI) of [($3,000,000 - $2,185,813) / $2,185,813] * 100 = 37%.
Scenario 2
Lot Split with 2 new 4,000 sq. ft 3-story Duplexes
For this second scenario, we suggest dividing the lot to build two individual three-story duplexes, each with an area of 4,000 square feet. The estimated cost, excluding land acquisition, is $3,486,057. The projected market value for these duplexes in Walnut is $4,800,000, resulting in an ROI of 38%.
Conclusion:
Real estate projects under SB-9 in Walnut City could generate an ROI below 50%. To lessen this risk, it is advisable to employ additional financial strategies or acquire land at a much-reduced cost.
See how much it will cost you to improve your property per SB-9
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