Since Jan. 1, 2022, SB 9, known as the “California HOME Act,” is in effect throughout the state of California. The law allows homeowners to either build two 800-square-foot homes on their lot or divide their lot in two for a total of four homes on a formerly single-family plot. Boosters say it will address the state’s severe affordable housing shortage, create generational wealth and give more rental and ownership opportunities to people priced out of desirable neighborhoods.
“It’s a first small step toward correcting 50 years of mistakes in California cities, where they down-zoned all the property and all the urban areas to single-unit housing and unleashed a historic housing crisis that just gets worse by the year,” he says Matthew Lewis, director of communications for California YIMBY (which stands for “Yes in My Backyard”).
However, the bill has faced vehement opposition, with 71 percent of Californians opposed, according to a poll this year. Brian Selem, broker associate at The Agency real estate firm, believes that the bill isn’t just government overreach, but it’s also bad policy. “If the state wanted more housing development, they should have incentivized the local communities who know their communities better to up-zone areas that are worthy of up-zoning,” he says.
According to the LA Conservancy’s Adrian Scott Fine, SB 9 (which does exclude designated historic districts) and other laws passed by the California legislature in recent years could ruin the character of certain neighborhoods. “They just are very blunt instruments. And I think that’s the biggest concern — that while well-intended, the way in which they could be used and how it will play out on the ground could be devastating for some neighborhoods,” he says.
There are also worries that property values may be adversely affected. “When you have a four-unit building, the home next door is going to become less desirable to somebody, right? They are not going to want that. Especially when this building does not come with any effective parking restrictions,” Selem explains.
Detractors believe that developers — not individual property owners — will be the ultimate beneficiaries of SB 9. “Investors are going to just buy homes and split a single-family home into four units,” says Kenny Stevens of the Kenny Stevens Team at Compass Real estate brokerage. “They’re not going to be renting it at any kind of a low or moderate-income kind of rent; they’re going to be trying to maximize income.”
Maria Pavlou Kalban of the Sherman Oaks Homeowners Association and founder of United Neighbors agrees, noting that SB 9 will continue the trend of developers buying up single-family plots and driving up prices. “They are just buying up homes, and they’re using them either for rentals or flips, because they own the land and that’s what they’re after,” she says. “So now, my daughter competes against somebody that has a huge amount of money, and you’re in bidding wars that your wages will never allow you to bid against.”
These worries have led some local government leaders, including the mayor of Solana Beach, to write Gov. Newsom, protesting the bill. Now that SB 9 has passed and been enacted, local cities including Torrance, Carson and Redondo Beach have reportedly drafted lawsuits which aim to challenge the bill.
Cities are also fighting back through local ordinances. Pasadena recently implemented an “emergency ordinance” to exempt around 20 percent of the city from SB 9 regulations, which the state government has effectively said is null and void and must be repealed within 30 days
For proponents of SB 9, the opposition’s qualms are much ado about nothing. “The voices are very loud, but there’s not very many of them,” Lewis says. “You’ll have people on blocks in single-family homes, opposing SB 9, because they say that a duplex will ruin their neighborhood. It’s like, ‘Dude, there’s a duplex three doors down from you.’”
According to recent reports, only around 500,000 properties in the entire state of California would qualify under SB 9, and there are no significant subsidies to incentivize homeowners to take advantage of it. “When you scatter that all over the state, what you’re going to see is one to two per neighborhood,” Lewis says.
“There are not going to be that many people who take advantage of it to change the complexion of the neighborhood,” Stevens concurs. “People have overreactions to everything.”