City of West Covina
All You Need to Know About Building on Properties in West Covina Under SB-9
Using SB-9 for real estate projects in West Covina City is a smart way for homeowners to either generate cash to pay down a loan or create rental income or extra space for family members while keeping their primary residence. A successful SB-9 project begins with understanding the eligibility requirements, how restrictions apply to your property, and which SB-9 option makes the most financial sense for your West Covina City property.
What is SB-9 and how does it apply to the properties in West Covina City?
What is SB-9?
Senate Bill 9 (SB-9) also known as California Housing Opportunity and More Efficiency (HOME) Act is a California law created to help alleviate the housing crisis. It enables homeowners to divide a single-family lot into two parcels and construct up to two housing units on each, resulting in the potential for four homes on the original property. The law streamlines the approval process by eliminating requirements for detailed environmental assessments and discretionary permits, provided certain criteria such as zoning and lot size are satisfied.
How does SB-9 apply to properties in West Covina?
SB-9 applies to properties in West Covina by allowing homeowners to pursue urban lot splits (ULS) and construct urban dwelling units (UDUs). This legislation streamlines the process for lot subdivision and additional housing unit construction, enabling property owners to divide single-family residential lots into two parcels, each accommodating up to two housing units.
What can homeowners build under SB-9 or West Covina’s HOME Act?
Urban Lot Split under SB-9
An Urban Lot Split (ULS) refers to the process of dividing a single residential lot 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?
Urban Dwelling Unit under SB-9
Urban Dwelling Units (UDU) are restricted to a maximum of two residential units within a single-family zone. These two units can consist of either two new constructions or a combination of a new unit and an existing one.
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?
Each new unit can be up to the size of the existing structure or 800 square feet, whichever is larger, with a minimum size of 500 square feet. SB-9 does not impose size limits.
Each lot allows for the development of two housing units, which can include ADUs and JADUs.
What are the setbacks?
Side and rear setbacks should be at least 4 feet, while front setbacks require 25 feet for additions.
What is the parking requirement under SB-9?
One parking space measuring 10 feet by 20 feet is required for each unit. However, this requirement is waived if the property is within half a mile of a major transit stop.
What are the lot constraints under SB-9?
Each new lot should have at least 12 feet of street frontage to allow proper access. When splitting a lot, one lot cannot be smaller than 40% of the original size. Additionally, both new lots should be at least 1,200 square 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?
In West Covina, Urban Lot Splits (ULS) and Urban Dwelling Units (UDUs) are allowed only on properties zoned as Single Family Residential (R-1).
Can you disregard the environmental restrictions on the lot?
No. While West Covina's SB-9 guidelines do not specifically mention environmental issues, properties in sensitive zones like wetlands, hazardous waste sites, floodways, conservation areas, or habitats for protected species are not eligible under California's SB-9 to protect these areas.
Can you bypass the Historical Preservation limitations?
No. Properties in historical districts or designated as landmarks, as well as those listed on the State Historic Resources Inventory, are excluded from SB-9 to protect their historical value.
Is it allowed to demolish an affordable unit?
No, you cannot demolish or alter affordable housing that is protected by a recorded covenant, ordinance, or law. These units need to remain affordable for moderate, low, or very low-income families.
Is it allowed to build in High-Risk Areas?
Maybe. Building in high-risk zones like very high fire hazard areas is not allowed. However, exceptions exist if local agencies exclude these sites or fire mitigation measures are in place. Similarly, building in earthquake fault zones is required to meet seismic safety standards set by California’s building codes to be considered for the project.
What are the limitations after completing a project using SB-9?
Does the homeowner need to reside on the property?
Yes, the homeowner has to sign a statement confirming they plan to live in one of the housing units as their primary residence for at least 3 years after the lot split is approved. This rule does not apply to "community land trusts" or "qualified nonprofit corporations."
What are the rental regulations?
Units from the lot split can only be rented for at least 31 days or more.
Are existing tenants’ rights protected?
Yes, tenant protections are in place. Lots of tenants living there within the last three years, or where the property has been taken off the rental market within the past 15 years, cannot be demolished or altered. If a unit has not been tenant-occupied in the past three years, only up to 25% of the exterior structural walls can be demolished.
Can condominiums be proposed as part of my Urban Lot Split application?
No, condominiums cannot be included in an Urban Lot Split application under SB-9. Creating condominiums requires a separate Parcel Map process involving fees, environmental reviews, public hearings, and an appeal period.
What is the difference between SB-9 and SB-684?
SB-684 is a more recent law that allows the construction of as many as 10 units on urban lots that are less than 5 acres. Unlike SB-9, which primarily targets single-family dwellings, SB-684 is relevant for multi-family zones and undeveloped lots in single-family neighborhoods. Furthermore, SB-684 does not impose the ownership restrictions that are part of SB-9’s regulations.
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 receive ministerial approval, which speeds up the development process by following established guidelines. This approach minimizes administrative delays and allows for quicker approvals without requiring extensive environmental reviews (CEQA) or public hearings. Nevertheless, even with this faster process, obtaining approval for a lot split could still take as long as 1.5 years.
What are objective standards?
"Objective zoning standards," "objective subdivision standards," and "objective design review standards" help make land development clearer and more efficient. These standards are specific and measurable, using established benchmarks that both developers and officials know. This reduces subjectivity during reviews, leading to a more predictable and consistent process for development.
What types of objective standards qualify for a waiver under SB-9?
SB-9 allows waivers for certain planning, zoning, and subdivision rules. These waivers are provided when compliance with these regulations would hinder the ability to build two units on a lot or stop either unit from reaching a minimum size of 500 square feet.
What are the steps to get the permits?
1. Submit Application: Fill out the application form from the Planning Division.
2. Owner's Permission: Get the owner's permission notarized and authenticated before submitting.
3. Pay Filing Fee: Pay a flat fee between $615 and $960, depending on the type of construction.
4. Occupant's Permission: Submit a form signed by the occupant allowing site access for investigation.
5. Submit Plans: Provide two copies of large plans, including site, floor, elevation, and roof plans. Plans should be 24" x 36" and folded to a maximum of 8.5" x 13".
6. Grant Deed: Submit a copy of the grant deed showing the current property owner's name(s).
7. Digital Copy of Plans: Include a digital copy of the full set of plans in a flash drive.
8. Proof of Residency: Provide three original and current proof of residency documents for any proposed Junior Accessory Dwelling Units (JADUs) and/or Urban Dwelling Units (UDUs).
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 the first scenario, we propose constructing a 4,000-square-foot, three-story duplex with an additional 1,000-square-foot Accessory Dwelling Unit (ADU). The total estimated cost for this project, covering construction, permits, and professional fees (excluding land costs), is $2,164,050. In West Covina, the market value of the completed property is expected to be around $2,500,000, resulting in an ROI of [($2,500,000 - $2,164,050)/$2,164,050]*100 = 16%
Scenario 2
Lot Split with 2 new 4,000 sq. ft 3-story Duplexes
In the second scenario, we plan to subdivide a lot and build two new 4,000-square-foot, three-story duplexes. The projected total investment for this development is $3,474,776, excluding land acquisition costs.
In West Covina, the estimated market value for these duplexes is $4,000,000, leading to an ROI of 15%.
Conclusion:
SB-9 projects in West Covina carry the risk of an ROI below 50%. To mitigate this risk, additional financial precautions are needed, or land must be acquired at a very favorable price.