In February, City Council broke with its longstanding pro-housing stance and sided with several other California cities in opposing SB 9 and SB 10. In September, Newsom signed both controversial housing bills into law.
Both bills change zoning laws to allow more units to be built on a single parcel of land, but there is a debate over whether this will help address the state’s affordable housing crisis or solely lead to more profits for developers and investors.
SB 9 allows owners to build duplexes on lots currently zoned as single-family housing and also offers the option to split lots into two. This ultimately gives owners the ability to build four housing units on a property currently limited to one house.
SB 10 gives jurisdictions the option to upzone land parcels near to transit to allow up to 10 units to be built per parcel. Neither bill has requirements that any of the newly constructed units be affordable.
“We opposed these bills because they do nothing to expand affordable housing and will lead to further gentrification and displacement of lower income residents,” said Oscar de la Torre, who initiated the motion for Council to oppose the bills in February.
Five councilmembers agreed with de la Torre and voted to oppose the bill, while Councilmember Gleam Davis was the only dissenting voice and maintains her support for SB 9 and SB 10.
“I believe that SB 9 and SB 10 give cities and homeowners the opportunity to build more inclusive and more affordable housing,” said Davis. “Compared to single family homes in Santa Monica, most multi-family homes are more affordable for nurses, teachers, and other valued and essential workers in our community. Allowing them to live where they work will reduce traffic and greenhouse gas emissions while creating a more economically diverse and stronger city.”
The differing perspectives of Davis and de la Torre exemplify the ongoing debate around these bills.
On the one hand, allowing more units to be built on single land parcels does provide an expeditious solution to meet an immediate need for more housing. On the other hand, upzoning land parcels increases the value of the land, which could entice investors to buy parcels and convert them into expensive developments that fail to create more working and middle class housing.
When it comes to development in Santa Monica, SB 10 will not have any immediate impact, but SB 9 could lead to more housing development in single family neighborhoods.
SB 10 will not have an impact because jurisdictions have to opt in to exercise the law. It is up to City Council to bring forward such an ordinance and, currently, the majority of members remain opposed to the bill.
SB 9 does apply to Santa Monica, which has several neighborhoods with extensive single-family properties such as North of Montana, Ocean Park, Sunset Park, Northeast Neighbors and Pico. However, the City does not anticipate seeing an immediate increase in development.
“Given that SB 9 is still reliant on the individual choice of property owners to split their lots, we don’t anticipate any sudden changes to single-family properties in the city,” said City Public Information Officer Constance Farrell. “When we look to other cities that have eliminated R1 (a more drastic measure) like Minneapolis, change has been extremely slow because single-family homeowners choose to live in their homes and not sell, or buyers of single-family homes choose to live in a home and are not developers.”
Some opponents of SB 9 disagree with this assumption and believe that the real estate market in Los Angeles is so profitable that many homeowners will take up payment offers from developers and opt to sell their homes. One such opponent is Casey Maddren, the President of United Neighborhoods for Los Angeles.
Maddren said he believes that speculative investors will pay good money to purchase these single family lots, knowing that the land will only increase in value when it can hold more units. He disagrees with the logic of the bill’s authors and believes that affordable developers cannot afford to compete with speculative investors to purchase these single-family lots.
“In their mind this is somehow going to create a lot more housing which will lower housing prices, but that value is actually captured by either the owner or the developer, it’s not captured by renters and buyers,” said Maddren. “We believe we should not be upzoning land and instead require developers to build within existing zoning and the reason for that is because that takes the speculative investment out of the market.”
There are several eligibility restrictions in place that will limit the use of SB 9. For example, homes that are in environmentally-sensitive areas, in historic districts or have been occupied by a tenant in the last three years are not eligible. If a homeowner wishes to split their land parcel in two, they must sign an affidavit signaling an intent to remain in their unit for the next three years.