New L.A. Zoning Laws Remind us Why Size Matters

Small Lots are Getting Smaller

Los Angeles’ City Council recently passed an update to its Baseline Mansionization Ordinance, reducing the build-able square footage in any given R1 (residential) lot. These new restrictions pose a challenge among realtors, developers and homebuyers alike.

We love a good challenge.

So, what’s the deal? In early March, zoning codes went into effect that reduced the square footage zoned for building (on residential properties smaller than 7,500-square-feet) from 50 percent of the lot’s total size to 45 percent, and completely eliminated the 20 percent bonus.

Previously, a 10,000-square-foot lot could hold a 5,000-square-foot home and, if the structure met certain provisional guidelines, the 20 percent bonus option would allow for another 1,000 square feet of building. Thus, new restrictions have reduced the potential size of new residential construction by nearly 33 percent.

With this, we see limitations among developers, as they scramble to recoup this lost structural range, realtors, as they have to sell slightly smaller homes to the same luxury market, and homebuyers, as now, a new sizable home requires an even more sizable lot, which is hard to come by in Los Angeles.

First thing’s first. Developers will have to get more creative.

Homebuilders will need to redefine floor plans and be willing to go subterranean; as such, basements will be crucial in preserving all the same amenities that luxury homebuyers expect.

They will also need to re-devise acceptable and comfortable floor plans while not sandwiching rooms, creating comparatively luxurious homes, but within a smaller setting.

One priority that we expect developers to consider is forgoing living rooms in exchange for one impressive great room. From what we’ve seen, living rooms have grown progressively smaller, so omitting the space altogether, in exchange for one open great room off the kitchen, can complement a modern open floor plan.

While these new zoning laws constitute one of the most dramatic shifts to occur in Los Angeles real estate in the last 10 years, change is the law of life.

With creativity and knowledge for how to both compensate for the loss of potential square-footage and sell it, we’re certain the City of Angels will maintain its deserved value.