California Governor Gavin Newsom signed Senate Bill 9 on September 16, 2021. The bill went into effect across California on January 1, 2022. Senate Bill 9, also known as SB9 or the California Housing Opportunity and More Efficiency (HOME) Act, changes the law to now allow up to two residential units on parcels designated for single-dwelling units. In other words, it effectively allows any homeowner to build another home on their lot. The purpose of the bill is to ease restrictions on development in an effort to address the housing shortage in California.
Under previous law, lots zoned for single-family residential use were required to be used for just that – single-family residential use, meaning each lot could contain one dwelling (and an Accessory Dwelling Unit, in some cases). Senate Bill 9, however, effectively doubles the number of single-family residences that my be built throughout California on lots currently zoned for single-family residential use. The bill accomplishes this by allowing two residential units to be built on a single lot or, alternatively, allowing a single lot to be subdivided into two lots. In effect, any lot zone for single family residential use may now contain a duplex, as opposed to only one single family home. A significant restriction of SB9 is that any rental of a unit/home built pursuant to SB9 may not be rented for a period of 30 days or less, thereby prohibiting homeowners from building a second unit specifically for the purpose of short-term rentals.
California Governor Gavin Newsom signed Senate Bill 9 specifically for the purpose of combatting the housing shortage. When he signed the bill in September of 2021, Governor Newsom stated the “housing affordability crisis is undermining the California Dream for families across the state, and threatens our long-term growth and prosperity. . . . Making a meaningful impact on this crisis will take bold investments, strong collaboration across sectors and political courage from our leaders and communities to do the right thing and build housing for all.”
It remains to be seen whether investors and homeowners will take advantage of Senate Bill 9, and to what extent. The recent success of allowing Accessory Dwelling Units to be built on single-family residential use lots is promising, but whether homeowners and investors are willing to build second homes on lots zoned and sized for one home is a different question. It will certainly be interesting to see what 2022 holds in store in terms of development, particularly in areas where lots are large enough to comfortably hold two homes.
If you would like to further discuss this issue, or how Esquire Real Estate Brokerage can help you in the Southern California real estate market, feel free to give us a call at 213-973-9439 or send us an email at info@esquirereb.com.
