Trendspotting: The Future of Single-Family Zoning

NewsWire: 10/12/21

• California has ended single-family zoning. The recently passed SB9 bill allows homeowners to convert their housing into up to four units. (The Economist)
• NH: It’s no secret California has a housing affordability problem. Over the last decade, median home prices in San Francisco and Los Angeles counties rose a whopping +144%, compared to +64% nationwide.
• Governor Gavin Newsom is trying to solve this issue by increasing the housing supply. He just signed into law a package of four housing bills. Most controversial is SB9. This bill ends single-family zoning; depending on a lot's size, a home can be converted into a maximum of four units. The other bills make constructing new apartment complexes easier.
• So why is ending single-family zoning controversial? Many local governments are upset they have lost the authority over zoning laws. Others say the move will lead to further congestion. And of course, the biggest critics are property owners. An influx of duplexes threatens to bring down the prices of other apartments and home values. It's no wonder Newsom waited to sign these bills until after the recall election. Property owners are a strong voting bloc.
• It’s important to note that this initiative is connected to a national housing agenda for the Democrats. In the infrastructure bill, cities that change zoning laws to allow more housing will be rewarded with grants and tax breaks. Cities like Minneapolis and Portland have already placed limits on single-family zoning. And I suspect similar actions will soon be taken in other blue cities and states.