Zoning the “Ultimate Constraint” to Housing in California

By: Kelsi Maree Borland
April 17, 2019 —

The California market is suffering from a housing shortage, which is in turn contributing to a severe affordability crisis throughout the state. The problem is serious. A recent report from Next 10 analyzing the housing shortage found that it could take 1,000 years for some California submarkets to reach a housing equilibrium under the current regulatory environment. While the problem is complicated, Scott Choppin of developer Urban Pacific says that zoning is the ultimate constraint to housing in the state.

“The ultimate constraint is zoning in California,” Choppin, founder of Urban Pacific Group of Cos., tells GlobeSt.com. “There is an oversupply of single-family zoned sites in California, and this is at the municipal and county levels. Most zoning maps are 80% to 90% low density, single-family zoned. Developers are always having to work within already zoned multifamily sites or have to do a rezone, and in this environment, rezoning is high contested. San Francisco and Berkeley are really good examples of onerous zoning.”

Updating the zoning guidelines is theoretically a job that could be handled be local municipalities; however, because of anti-development sentiment, updating zoning is potentially and acrimonious process in many markets. Even worse, it could create a patchwork of zoning that varies significantly from city to city. A recent effort to create density and up zoning in Long Beach is a perfect example. “In Long Beach, where we are based, the city staff had to do a land-use element update as part of their housing element with the state of California,” says Choppin. “They issued maps of proposed up zoning across wide swaths of the city. The city staff was forward looking, but the neighborhoods went insane and were out of their minds crazy about this. In the end, there was a battle over these maps and they were gutted. That is one example.”

The Long Beach effort shows the potential downfalls of handling zoning only at the local level. Ultimately, Choppin imagines the solution will be a joint effort between the state and local municipalities. “It could happen at the municipal level, and it will vary highly as to the success,” he says. “I think it is going to be a hybrid model where the state will have some codified models to produce action at the state level and then each city will be required to live up to its obligation. That will include improving new projects and changing zoning to incentivize development. Generally, you can make the statement that it will not happen on the municipal level by itself.”

In some ways, this could still be a challenging process. For example, the State is currently bringing a lawsuit against the City of Huntington Beach for not adequately allowing for the construction of new housing. These are the type of actions that we should expect in applying the hybrid model. As a result, finding a better pathway to providing housing to residents could be a long road. “This could be a multi-decade process, and I say that because of how we got here,” says Choppin. “It was a multi-decade process.”

Article courtesy of GlobeSt.com

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