It is already legal to add an ADU and a junior ADU to a property zoned single-family. Another bill has passed the California Senate that allows up to four units total – and to be able to create two parcels, which means they could be sold separately – if the owner agrees to occupy the property for at least three years. Here’s a thorough article on the subject with examples:
Senate Bill 9 would technically allow as many as two duplexes, two houses with attached units, or a combination — capped at four units — on single-family lots across California, without local approval.
The bill would allow more building where it’s now illegal, with the intent of reducing California’s fast-rising home prices and increasing access to homeownership through a greater variety of options, according to state Senate leader Toni Atkins, a Democrat from San Diego who introduced the bill and similar versions in the past.
The bill returns to the Senate for expected concurrence on the amendments before heading to Gov. Gavin Newsom’s desk.
A group calling itself Californians for Community Planning Initiative immediately filed a proposed constitutional amendment for the November 2022 ballot to reassert local control over zoning and land-use decisions in opposition to the bill.
But some analysts say the linchpin of the Senate’s housing package would probably have a negligible impact on the California housing crisis, at least in the short-term. As for the nightmare scenario described by opponents? There simply isn’t enough evidence to back that up, either.
That’s because a change to zoning means very little in reality, starting with the number of units that would actually get built, these analysts say.
Pacific Legal Foundation obtained public records from San Diego and Riverside Counties (two of the most populous counties in the state) to determine whether local governments are abiding by the new 60-day permit-approval period, which took effect in January 2020.
Unfortunately for California residents, local governments are failing miserably to abide by the new state law.
San Diego County took a median of 187 days to issue an ADU or Junior ADU building permit after January 2020. Permits issued prior to the new law took a median of 112 days to be issued. Only 52% of permits issued prior to the new law fell within the previously required 120-day mark.
Currently, only 5% of permits issued by the county met the state’s 60-day deadline. Many times, the permitting process is held up by excessive fees or approvals needed from other departments within the county. As of July 21, 2021, there are 587 pending applications, of which 90 were submitted prior to 2020. If these permits were issued today, the median wait time would be 255 days after the application was submitted.
The government, and society in general, needs to recognize how dire the housing crisis is for the citizens. We’re going to have continued upward pressure on home prices and rents, and building ADUs is one of the best ways to alleviate the problem. It doesn’t matter if the resistance by local governments is conscious or sub-conscious, the ADU-approval process needs to improve radically to implement the will of the people, and slow down prices.
Prop 19 was sold by the California Association of Realtors as a solution to the low-inventory environment. The intent was to free up seniors over 55 to move anywhere within the state of California, and take their old property-tax basis with them.
The C.A.R. said it was all we needed to create more inventory!
While we don’t have any direct results yet, but with inventory about 10% behind last year’s covid-impacted count, and 21% behind the 2019 count of total listings between Jan 1 and July 30th, it’s safe to say that Prop 19 hasn’t had achieved its goal yet.
Or maybe I just need to do more!
Do seniors just need more information on transferring their current property-tax basis?
If so, here’s your taxpayer advocate:
As Rob Dawg duly noted, seniors may need to stay in California so they can take their low property-tax basis with them to make it worth moving.
Where can you move within California? Here are some ideas:
Julian is close by, and you can get this 2,808sf one-story for $825,000:
We hope to build a referral network with agents in every town, and in the meantime, Donna is excellent at vetting realtors for you. Let us know where you want to move, and we’ll set you up with a top agent!
The residential real estate market has no boundaries on pricing.
It’s free enterprise at its finest – no laws, no restrictions, and no limit on where prices can go.
We saw a dramatic example where a model-match tract home on the same street sold for $550,000 more than the last sale the month before!
Many local homeowners can say they’ve picked up another half-million in appreciation in just the last year, which provides one more hurdle to moving.
Their net profit exceeds $500,000, which means they are going to pay capital-gains tax if they move.
Nobody likes to pay tax to Uncle Sam – especially when it might be six-figures!
We’ve seen it with the investment properties, for example. Long-time owners who paid a tenth of the money they can get today who absolutely refuse to sell just because of the taxation. They could still reap hundreds of thousands, or even millions in profit after paying the tax, but it irks them so much to pay the government that kind of money, that they refuse to consider it – and most consider it a shakedown.
It’s the same with residential. If you have to pay the government a big chunk of your profit in taxes, you’re going to think twice. It may even be the last straw, and end up being what prevents you from moving.
The 2-out-of-5 years exemption was created in 1997 and gives married homeowners as much as $500,000 in net profit, tax-free, when they sell their home.
But in 1997, the median home price in America was around $170,000 – and today it is twice as much.
Shouldn’t we revise the rule to reflect the increase?
I think so.
Let’s double the exemption and make it $1,000,000 tax-free.
Politicians would need to agree that the lack of supply is killing the American Dream for the middle class. Without more homes for sale, the pricing will continue to climb until homeownership is beyond the reach of most people – which it already is in many areas.
When the Fed cut the Fed Funds rate to zero at the onset of Covid-19, it caused mortgage rates to drift under 3%, giving the illusion of helping home buyers. But it has been the sellers who have reaped the big rewards.
The San Diego Case-Shiller Index has gone up 19% in 13 months, and the NSDCC median sales price has INCREASED 38% between March, 2020 and May, 2021.
Creating a state program to increase demand would do the same thing.
Flush with a historic budget windfall of more than $100 billion, state lawmakers have a chance to put their money where their mouths are on housing. Assembly and Senate budget leaders alike have identified homeownership as key, but must still agree on the details.
The Assembly has made it a priority to increase investment in the finance agency’s down payment assistance program. By how much, or the source for that funding, is yet to be hammered out.
In his revised budget that he submitted to the Legislature on Friday, Gov. Gavin Newsom proposed a $100 million state and federal investment in the same program. Newsom also proposed $100 million to finance “granny flats” and other accessory dwelling units for low- and middle-income families.
Senate Democrats have a more radical idea. Under their pandemic recovery budget blueprint released last month, the state would partner with first-time homebuyers to buy through what they’re dubbing “California Dream for All.” The state would pay, and own, up to 45% of the home, cutting the purchase price for people by nearly half. For example, a family could buy a $400,000 home for $220,000 under the program.
The money would come from a yet-unspecified revolving fund set up by the state, with shares sold to investors. As home values increase, so would the value of the shares.
The Democrats have proposed commissioning the state treasurer to hash out the program in greater detail and present it back to the Legislature for approval in 2022.
The expansion in homeowner aid would disproportionately favor low-income communities of color who most need the help, allowing the state to “circle around” the constitutional provisions that bar the state from considering race in programs, said Muhammad Alameldin, economic equity fellow at the Greenlining Institute in Oakland.
Above is the map produced by the City of Carlsbad to help identify the areas where they can increase production of multi-family units, and try to reach their low-income housing goals.
I circled in red the larger developments:
The owners of the Mall have proposed rezoning their parking lots and adding 993 homes there, plus the neighboring Verizon/Michael’s shopping center has proposed redeveloping it into 242 residential units – a total of 1,235 homes.
The #4 site in the middle was once going to be a WalMart (who owns it), but it never gained traction. A developer from Phoenix has proposed building 474 homes on the 39 acres there.
There are six parcels totaling 21 acres on both sides of Poinsettia at Brigantine. Under the current zoning, 50 homes could be built there, but the developer as applied for upzoning so they can build 327 multi-family units.
If re-zoned, these projects will include NO single-family houses. Because the city is pressed to hit their goals, it looks like most of these units will be restricted to low-to-moderate income residents.
The tunnel under the freeway seems extravagant when people can use the existing Carlsbad Village Drive access. The rest of the project seems simple and relatively inexpensive if the tunnel is left out. Let’s note that the map above is from 2009 – none of parking structures have happened yet.
The Imagine Carlsbad team will host a monthly Carlsbad Village walkabout and Q & A on Monday, April 19th at 6PM. The first walkabout will focus on the topic of the Grand Promenade and Grand Street Tunnel. Come meet Gary Nessim and Bob Wilkinson on the corner of State and Grand to review the vision and plans for a Village gathering space called the Grand Promenade and the proposed Grand Ave tunnel under the 5 freeway to Pio Pico.
The Grand Promenade was originally presented to the City Council Members in 2009 and has been incorporated into the Village and Barrio Master Plan. There will be a short walk along Grand and a Question-and-Answer opportunity following the walk. The team at Imagine Carlsbad plans to host a monthly walk to address pertinent issues including: Northwest quadrant Civic Center options, Parking, Architectural Style. Looking forward to seeing all interested citizens.
If you transfer ownership to your kids by February 15th through a grantor trust or irrevocable trust, then they won’t be impacted when the new rule takes effect. Ask about your IRS step-up in basis though.
The county recorder’s office is closed on February 15th.
The county recorder’s office is closed for over-the-counter work due to the pandemic.
If you notarize your document by February 15th, they will accept it as long as you record it at the county recorder’s office within three years.
Call his cell phone during normal hours (his wife is a divorce attorney).
Coming back to this. Was just on the phone with one of the largest home lenders in the country. They said cash out refinances were <10% of business last year and 50%+ starting this year. Said it won't show in the data for another few months. Added other uses: reno & college https://twitter.com/AliWolfEcon/status/1486739714308599808
Jim the Realtor is legit - I interviewed three brokers; he said list price should be $100,000 higher than the other two brokers; listed it with him and had all cash (no financing) offer in two days, five day contingency period, closing in two weeks - and it closed at his recommended list price. I could not recommend anyone more than I recommend Jim the Realtor.
When we moved to San Diego in 2005 we rented a big house on Mt. Soledad (La Jolla) with 180 degree ocean views for the same payment as a mortgage on a dump in Chula Vista. Clearly something was wrong. Yet, the media was full of the usual happy-talk nonsense, so I was glad to find Jim's blog. I've followed his honest assessments and data since.
We decided to sell and move to AZ at Thanksgiving. Dec. 1st we met with Jim to sell our home. We closed today (29 days later). Jim orchestrated a feeding frenzy -- we had 25 showings in 2-1/2 days, multiple offers, and sold for well over asking price. I'd say he earned his commission! We have owned and sold homes in 5 different States always using experienced, productive, full-time realtors. Jim outshines them all.
You don't decide to sell and close 29 days later over Christmas (with COVID lockdown) without some miracles. Donna was amazing at performing lots of those miracles and ensuring that everything was done right and on time. They are a terrific team with a very responsive and professional network.
Where do we begin..2020 has been a year for everyone. When COVID hit and shut down both my husband and my businesses, we were left with a mortgage and very little income coming in. We were stressed, scared and felt stuck. We made the hard decision to sell our home and move out of state. We contacted the Klinges' and spent a good hour going over what we hoped we could accomplish. Jim and Donna came over with comps in hand and suggestions on improvements to get our house ready for the market. It was overwhelming to think about, but Donna was there and one step ahead in every scenario. Basically we just approved what they suggested and Donna handled literally everything. We placed our house on the market and within the first day we had multiple offers well above asking price! We couldn't believe it. We were overjoyed! Jim countered the offers to weed through them, and everyone came back with way more. It was amazing, and we are ?? sure it was because of the staging and repairs the Klinges suggested we do.
Due to unforeseen dishonesty from the buyers lender, we hit a big hurdle when trying to close. We had already moved out of state and were shocked when three days before closing the lender dropped a bombshell on the buyers and us. However, Jim and Donna handled it like veterans, not afraid to play hard ball and represent their clients. After a few phone calls with us, and several between Donna and the lender, they had a plan B-Z to make sure we were taken care of. In the end we closed with even more money than we ever thought possible and with very little work from us. The Klinges handled this entire "2020" worthy event with the utmost professionalism and did everything in their power to not only make this as smooth as possible for us, but we also walked away with more money from the sale of the house than we ever hoped for. After working with Jim and Donna, you don't ever use anyone else. They are hands down the best team to represent you in any scenario.
Working with Klinge Realty Group was a great experience! They are very responsive, professional and knowledgable about the real estate market! I would definitely recommend Klinge Realty Group.
Jim and Donna Klinge made the sale of our condo extraordinarily easy. They know the market and gave us sound advice backed by details and very considerable experience, reflected both in the initial pricing and subsequent negotiations. They work together as a team and are always available to talk. We had a few challenges with our property and they were able to coordinate the resolution to everything, including items that I would not think would ordinarily be their responsibility to handle. They made the whole process effortless on our part. They are folks with high integrity and we cannot recommend them highly enough.
Review for Member: Donna Klinge
I cannot believe there are no reviews of Donna yet, ugh!! She is the secret sauce of the Jim Klinge/Donna Klinge combo! I will touch on Jim here, but Donna is why I'm so totally loyal to these two (no offense to Jim :)).
I consider myself a rather savvy buyer/seller. I've bought/sold 7 times in about 15 years. On the buy side, Jim is the PERFECT combo of: completely digitally savvy (he will pull data all day long until you feel comfortable with your chosen house, area, school district, anticipated appreciation rate...anything!), he's super well respected and known in the area by other agents, an amazingly cool but strategic negotiator, is totally devoid of desperation for a sale/commission, and more.
Then once you get into contract phase, Donna literally handles every last and final detail in a concierge-like manner -- totally shielding you from the daily back and forth, noodling and annoyances of the buyer's requests. She solves it ALL; it's miraculous what that woman accomplishes over and above what is even expected in a buy/sell transaction.
On the sell side, Jim and Donna do the same, but even moreso. Donna in particular truly takes everything off your plate: she'll manage getting the house painted, the carpets replaced, she'll go on site (as she Jim both did for me when selling our rental properties) to work with the renters and make sure the house is ready to show -- freeing me to have to take time off of work to do so. They work with A+ integrity, too, so you know you are serving all parties fairly and lawfully throughout.
A home purchase/sale is the most considered you'll ever make. HIRE A SAVVY AGENT, not a friend!, and get what you need out of the transaction. Jim and Donna are our agents for life.
Jim and Donna Klinge are by far the most professional, personable and responsive realtors I have ever worked with. They provide VIP concierge level service in every area of the process of selling your home. My home was marketed so successfully that we received an offer the day after our first and only open house. Thanks to Jim's pricing and negotiating, our house is now the highest sold in our community. Jim's vast experience means he has worked with several realtors and knows the market all over north county. Donna is AMAZING in processing everything in the transaction. She scheduled trades people to work on the house in preparation for the sale as well as the repairs needed before closing. She communicated clearly every step of the way about what would be happening. She took the weight off my shoulders for the whole process. I will always use Jim and Donna for my future real estate needs and I whole heartedly recommend them to anyone buying or selling a home.
Jim and the team at Klinge Reality are without a doubt the best in the business! Not only was Jim helpful and extremely knowledgeable, he was patient and determined to help me find my first home. Jim and his team have been in the business for many years, and it shows. Jim is a wealth of knowledge and was my biggest proponent despite the temperature of the competitive market. I ended up getting the perfect property in my dream neighborhood all thanks to Jim. From the day my offer was accepted, Donna was a real lifesaver. She was extremely helpful, responsive, and knowledgeable when it came to every minute detail, and held my hand through the process. As a first time home buyer I had no idea what the process would entail, but Donna curtailed every concern I came across and made the escrow process feel seamless. Jim and Donna provided me the best home buying experience, and I am very grateful for all they did for me. It was truly a pleasure to work with Jim and Donna and I am already looking forward to the next time we work together!
Review for Member: Richard Morgan
Richard is an amazing realtor! He has high integrity and genuinely cares about his clients and their needs. Richard paid close attention to what I was seeking in a home and was very patient in our search to find it. I would highly recommend Richard and will use him for future transactions. Truly a different kind of realtor experience!
Could not be happier with my experience with Jim and his team. He helped me sell a very unique and challenging property. Throughout the entire process he was always available, honest, transparent, trustworthy, and always put my interests as a seller first. A (rare) true professional! During close of escrow Jim went above and beyond to complete the deal. It would not have been possible without his experience, fantastic team, and pure dedication. Highly recommended!
Thanks Jim and Donna Klinge!