While the California housing bill SB9 inspired fierce debate as it worked its way through the legislature last year, there was one thing its most passionate advocates and critics agreed on: The law would have a big impact on neighborhoods.
SB9, which went into effect in January 2022, allows for the construction of up to four housing units on lots zoned for single-family homes. It does this by letting homeowners build a duplex where only a house was permitted before. Or they can split their lots in two, building a house or duplex on each side.
Supporters, including in the YIMBY movement, heralded the legislation as a significant step towards solving the housing crisis in cities where residential construction has not kept pace with population or job growth. By allowing for more density, but at a scale that doesn’t completely transform the surrounding area, the law would help ease housing prices by boosting supply, they argued.
Tenant advocates who opposed SB9 worried it would further gentrification and displacement, turning homes in working-class neighborhoods into lucrative development sites without ensuring the resulting duplexes would be priced affordably.
Homeowner groups called it “the beginning of the end of homeownership,” placing Oakland on a list of “endangered cities” threatened by the law.
But data shows that SB9 has neither remedied nor ruined anything in Oakland—at least not yet.
According to city building records, SB9 hasn’t yet proven itself to be the game-changer its supporters promised and its opponents feared. Only two people had filed for SB9 project permits by mid-October, nearly a year after the law was implemented.
The Oaklandside spoke with these two residents who are trying to build another house next to their own. They both said SB9 enabled projects their families had long wished to pursue. But they also said there’s still plenty of bureaucracy, and the cost of building an SB9 project is still high.
The cost of building a new family home
Jilliane Denise T. Calucin lives with her mother, husband, and 6-year-old daughter in the Dimond District. The house is Calucin’s mother’s, and Calucin’s young family has long dreamed of building a place for themselves in the large yard there.
Until this year, doing so seemed impossible. Their lot was zoned for a single-family house only, so the family would need to subdivide it, an expensive legal endeavor that would require development know-how.
“When the SB9 law passed, that definitely enabled us to build…and to build a bigger home than the existing house,” said Calucin, a nurse. The family began its application with the city immediately.
The process has been more complicated than they expected.
“From inquiring with the city, to getting a loan approved, to having the lot surveyed, to finding the right people that can help us plan and design, to processing the permits that are needed, to waiting for the soil test report and sewer lateral report—the list goes on,” Calucin said.
“We are hoping that the house will get started as soon as possible because by next year we would love to celebrate Thanksgiving and Christmas in our own home,” she said.
Abbas Hakimzadeh, the other SB9 applicant in Oakland, is on an even slower timeline.
The software engineer and his wife want to build a second house in their large backyard in Millsmont. Before the state law passed, they’d planned to build a cottage, or “ADU” there, taking advantage of recent rules permitting small accessory structures on most properties in Oakland. But ADUs can only be 1,200 square feet at most, and the couple desired a larger house since they have the space for it.
Many of the modest homes on their block have long, narrow yards. Hakimzadeh was drawn to the feature when he bought the place in 2015, because it reminded him of the yard he grew up playing in in Iran. But as their business—the couple runs a home daycare there—and family grew, they set their sights on building a larger home for themselves on the expansive lot.
“When they passed SB9, I was so happy,” Hakimzadeh said. That eagerness soon turned to frustration when he learned about various regulations—the two split lots must be around the same size, for example. He also had trouble getting answers to his questions from the city.
Then came the fees.
He readily paid the first—a $10,000 planning fee.
“After that, the building department asked for $70,000,” he said. “I was like, ‘This is a lot!’ The building is probably going to cost $500,000 to $600,000. I should pay 10% to the city?” The cost was eventually reduced to $50,000, still a struggle to afford.
The city determines building fees through a complex calculation involving the size and elements of the proposed project and its location. The calculation is the same whether it’s an SB9 project or not, according to the Planning and Building Department.
Hakimzadeh has reluctantly put his application on pause, until a loan comes through.
“The philosophy and the mindset behind the law is very nice—to have more houses in California and resolve the housing crisis,” he said. “Probably an architect or homebuilder that knows the process from A-Z, it’s easy for them. But this law was passed for homeowners.”
The state and cities should learn from those regular residents’ experiences, he said, and get rid of obstacles that have kept the project numbers down.
Too early to tell?
Oakland has 51,000 lots eligible for SB9 projects, according to the Terner Center for Housing Innovation at UC Berkeley, but a project is financially feasible on only 3,000 of these. The owners of the 48,000 other properties would be unlikely to recoup their investment by renting or selling the new building, the researchers found.
Calucin was surprised to learn that only one other homeowner has taken advantage of SB9 in Oakland so far.
“But I also see why,” she said. “Maybe it’s because of the long process, lack of a source of income, or they see that buying a house that is already built is more convenient, even if it costs more.”
However, it’s been less than a year since the law went into effect, and it’s too early to draw any conclusions about its impact, say housing analysts.
“If you polled homeowners in Oakland, some tiny percentage of them would know what SB9 is or that it’s legal to do this on your lot,” said Max Davis, an Oakland resident and board member of East Bay for Everyone, which supported SB9.
“This is something we needed to do and it is a big deal,” Davis said. “It’s opening single-family neighborhoods to more development and denser development. But it takes time.”
He expects to see SB9 construction pick up over time, just like ADUs did. More than 850 building permits were issued for ADUs between 2018, after state and local restrictions were eased, and 2021. Once a neighbor builds one, another gets the idea, Davis said. Now, ADU companies advertise on social media and real estate agents highlight yards or garages primed for conversion.
“I could imagine them saying, ‘This is perfect for a lot split,’” Davis said. He believes that “reducing any of the barriers is going to help,” whether through pre-approved designs for new homes or eliminating some of the paperwork required by the city.
He noted, however, that many Oakland homes, especially in the denser East Oakland flatlands, aren’t perfect for lot splits—there just isn’t enough room to build another house. That geography could partially account for the low project number.
Some Oakland residents have worried that SB9 and other rezoning efforts amount to a giveaway to developers, who could scoop up cheap houses in low-income neighborhoods, demolishing and replacing them with four expensive units. The law tries to prevent that outcome by only allowing homeowners who live on the property to build, and by prohibiting the same person from redeveloping two adjacent lots. The law also attempts to prevent displacement by banning SB9 projects in places where tenants have lived in the past three years. But some residents are still concerned that new units will be used as Airbnbs instead of adding to the rental supply.
Iin Oakland and similar cities there were also unique concerns about adding density to areas with high fire risk. SB9 applications are now prohibited in the fire-hazard zone in the hills.
Still other opponents of SB9 want to maintain the current restrictions and look of existing neighborhoods, a premise that’s come under scrutiny in recent years because of the racist history of single-family zoning. We reached out to Livable California, the primary group that tried to stop SB9 from passing and that’s now leading a charge to repeal it through a ballot initiative in 2024, but they didn’t respond.
Oakland could eliminate single-family zoning
All the debate around SB9 could soon be moot in Oakland.
The City Council voted unanimously in early 2021 to explore the elimination of single-family zoning throughout Oakland. Currently, 65% of Oakland’s neighborhoods are zoned to permit only single-family homes (plus ADUs, in most cases). That’s below the Bay Area average of 81%, but it still means that without SB9, it was illegal to build duplexes in a majority of the city.
The city is currently writing its Housing Element, a sweeping, eight-year plan for housing in Oakland that’s required by the state. In the document, Oakland must identify locations for a whopping 26,000 new housing units.
One way the draft plan proposes achieving that is by changing the zoning code to allow two, three, or four units on most lots where single-family homes are currently the only type of housing permitted.
If the city adopts these changes in the coming months or years, homeowners who want to redevelop their house as a duplex, or build another home next to theirs, will no longer need a state law to get around city limitations.