California Senate Bills 8, 9, and 10: What Are They—And How Might They Affect You?

Across major Californian cities like Los Angeles, San Francisco, and San Diego, affordable housing is in short supply. In fact, the median price of homes for sale in San Diego is $700,000—demonstrating just how high California home prices have climbed in recent years. In an effort to address the increasing lack of affordable housing, Governor Gavin Newsom recently signed Senate Bills 8, 9, and 10, enacted in an effort to generate more affordable housing units by providing more funds and tools to affordable housing developers. Read on to learn more about each of these bills and how they may affect you—regardless of your economic standing.

The Housing Act Crisis Act of 2019, which was set to expire in 2025, was extended with the passing of Senate Bill 8. This act prohibits the government from reducing the permitted housing density (also known as downzoning). It also accelerates the process of approval for affordable housing projects and puts a limit on fees for housing applications. This is meant to encourage developers to invest time and energy into affordable housing projects.

The creation of more housing options on existing parcels of land will facilitate more available affordable housing. In accordance with this belief, Senate Bill 9 allows property owners to have two units on one piece of land that was previously zoned for a single-family residence exclusively. In essence, Senate Bill 9 will allow property owners to create a duplex, providing that the property owner continues to live in one of those units for at least three years. There are some exceptions to this rule for historic districts, earthquake zones, and very high-risk fire zones.

For Senate Bill 9 to take effect, the plot of land in question must be at least 1,200 square feet with one parcel taking up no more than 60% of the total parcel size. Senate Bill 9 is similar to Senate Bill 1120, but it differs in the fact that it does not encourage investors from evicting any current tenants as it excludes all properties where the current tenant has lived for three or more years.

Senate Bill 10 has few opponents, as it will allow the city to zone parcels for up to 10 residential units in many California cities. The caveat is that these parcels of land must be located in “transit-rich areas”—within a half-mile of a central transit stop or along a fixed-route bus line. This bill will allow real estate developers throughout the state to bypass the California Environmental Quality Act and build new developments much more quickly, and with less red tape.

Senate Bills 8, 9, and 10 are not universally endorsed by those who currently own California real estate. Among the concerns are that property owners may be able to sell or rent a home that was developed under Senate Bill 9, and that Senate Bill 9 essentially affects only a small portion of the state’s parcels (5.4%). As such, opponents argue that it will likely only be financially feasible for 110,000 of the eligible 410,000 parcels to be developed as additions to the state’s supply of affordable housing.

Opponents fear that Senate Bill 9 favors wealthy investors instead of local residents and that it could be infringing on the city’s local decision-making rights. Additionally, those who are opposed worry that new development at an increased pace will not allow time for the additional utilities, parking, and transportation needed to sustain them to be constructed, and that these communities will eventually fail at providing livable space for low-income Californians.

Some believe that these new bills will, at least in part, effectively address growing concerns about the lack of affordable housing in the state of California. They believe Senate Bills 8, 9, and 10 will create more than 700,000 new homes—mostly duplexes—that otherwise would not be built. Supporters also think that these bills will address skyrocketing home prices by increasing the number of homes available and will help more California families pursue homeownership by legalizing multifamily housing in areas where it was previously not allowed.

Supporters also feel that these bills will make it easier for developers to access the finances and tools necessary to build these much-needed additional units and ease some of the red tape that gets in the way of rapid building.

Only time will tell if these new measures aid the affordable housing shortage in San Diego and in other California cities. However, the governor’s legislation is a state-wide attempt at moving toward a greater supply of affordable homes.

If you’re worried about the lack of affordable housing options in San Diego or are interested in exploring your San Diego real estate development options, contact the knowledgeable local realtors at The Savory Group today. This team of real estate experts is knowledgeable about the new legislation and how it may affect your San Diego neighborhood. Whatever your situation, The Savory Group’s trustworthy agents can provide the legal analysis, local insight, and expert guidance to help you make smart decisions in San Diego’s transformative real estate market.