The California HOME Act law from 2022 holds the power to end the housing shortage by splitting a single-family parcel in two lots and building three additional units.

On enactment of the Home Act, an estimated 700,000 units based on fourplex construction have the potential to overthrow the reigning housing shortage by building on single-family residence (SFR) parcels, according to Terner Center.

Property owners are now authorized to build three additional units for rent or resale on their SFR lots in response to the overflow of missing housing, by:

  • splitting their lot into two parcels — each parcel may be no smaller than 1,200 square feet and no smaller than 40% of the original lot; or
  • building duplexes — a project containing up to two dwelling units on a single-family parcel. [Government Code 66411.7 (a)]

Further, local agencies have been given strict rules for what they may and may not task an SFR owner with when the city administratively processes plans for the additional unit to fence off attacks by the not-in-my-backyard (NIMBY) action groups.

For example, plans submitted for a permit to add a residential unit on a property

within a single-family residential zone are to be considered without a discretionary review or hearing when the proposed housing development does not require demolition or alteration of low- or moderate-income housing. [Government Code §65852.21 (a)]

California builders have already been submitting plans to dive into the accessory dwelling unit (ADU) water with applications to split their lots in cities including:

However, in the same way that ADUs have historically faced a difficult approval process, the newly legislated process is turning out to be a similarly long timeline.

Related article:

Tiny homes join ADUs in the housing shortage fight

The Home Act needs an ADU update

The permit process for ADU construction has been simplified. Though it took a while for the ADU application process to be smoothed out, the Home Act for fourplex construction will benefit by adopting some of the ADU efforts.

The parceling and fourplex construction process has been a slow moving one due to the exacting standards of each local agency — and it needs some work.

Builders submitting applications for quad construction will benefit from the legislature:

  • providing more standards for local zoning ordinances — such as the parameters for new units;
  • creating clear instructions for the administration of local building permit procedures; and
  • knocking down homeownership barriers — such as stifling infrastructure fees for small housing projects, according to the Terner Center.

It’s easier to build quads on larger lots when there’s clear instructions enabling homeowners to build. City councils are rather prone to set up obstacles to stop the permitting process with use-of-a-parcel type restrictions solely designed to interfere.

Builders and homeowners who take advantage of this new legislation have the opportunity to develop an extra source of income by building and renting residential units.

Agents and brokers need to have a conversation with their state legislator to suggest additional Home Act improvements. Also, to stay up to date on legislative updates, follow firsttuesday’s legislative gossip.

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How agents can get ahead of the mid-tier housing shortage