Pro-housing advocates in San Diego are calling for a significant change in residential lot size regulations, arguing that smaller lots could lead to lower home prices and increased tax revenue for the city.
On Friday morning, a coalition of housing groups convened in front of City Hall to present research from housing analysts London Moeder Advisors, which they claim supports their initiative.
The coalition aims to convince the City Council to consider a proposal that could eliminate minimum lot size requirements, paving the way for denser residential developments in the city.
Currently, San Diego has a minimum lot size requirement of 5,000 square feet that has been in place since 1923, covering over 80% of the city.
According to the coalition, allowing for smaller lot sizes would enable the construction of more homes on parcels of land that traditionally housed only single-family residences.
Ricardo Flores, the executive director of Local Initiatives Support Corporation, emphasized the importance of homeownership, stating, “This is San Diegans helping San Diegans. Homeownership benefits all of us. It creates stronger and more stable neighborhoods, generational wealth and strengthens families.”
The research by London Moeder Advisors draws parallels to other cities that have successfully modified their zoning laws to accommodate smaller lots, notably Houston, Texas, which reduced its minimum lot size from 5,000 square feet to 1,400 square feet back in 1998.
Flores referred to their proposal as “light density,” suggesting it’s less disruptive compared to traditional apartment developments in residential areas.
The coalition believes that homes built on smaller lots will be more affordable than conventional single-family homes, which would be a welcome relief to many residents grappling with the high cost of living in San Diego.
While the proposal has been submitted to the city, there is no guarantee it will gain traction within the City Council. Efforts to reach Mayor Todd Gloria’s office for commentary on the proposal were unsuccessful.
In 2023, Mayor Gloria had abandoned another initiative aimed at increasing housing density, which would have permitted greater construction on existing single-family lots.
The potential taxation benefits of the proposed changes are notable.
The report estimates that if 150 to 400 properties were developed under the new ordinance, the city could see a revenue increase of $10 million to $43 million annually. If developers push the envelope to build up to 4,000 new homes in a year, the projected tax revenue could soar to $430 million.
“The best part of this is that families could own a home,” said Lori Holt Pfeiler, CEO of the local Building Industry Association. She added that increased property tax revenue would significantly benefit the city’s finances.
The report suggests the tax revenue estimates are conservative and could fundamentally transform the city’s tax base for years to come. However, the proposal does not factor in potential drawbacks, such as heightened stress on infrastructure resulting from a population increase.
Nicole Lillie, director of the youth-led nonprofit Our Time to Act, articulated concerns regarding the housing crisis, stating that many young graduates are leaving San Diego due to unaffordability. She noted, “There are fewer taxpayers for the city.”
Highlighting the struggle of many young residents, Lillie underscored that those who remain are often stretched thin financially, hampering their ability to engage with and support their local communities.
The coalition’s research indicates an economic shift is possible, as most homes in San Diego sit on larger lots than the proposed 5,000-square-foot minimum. The study reviewed nine neighborhoods in the city and discovered average lot sizes ranging from 7,636 square feet to 12,396 square feet.
Central to the proposal are two main features intended to mitigate neighborhood opposition: a mandated parking requirement and the exclusion of rent-controlled subsidized housing.
London Moeder Advisors proposes not to dictate exact plans for developers or homeowners, but suggests a financially feasible option is to build two- to three-story single-family homes without backyards. This model resembles popular housing types in areas like Otay Ranch in Chula Vista, appealing to buyers who prefer standalone homes over condos or townhouses.
The research suggests a single lot could house two or three of these vertical developments, maximizing land use while providing more housing options.
Additionally, the proposal stipulates that at least one dedicated parking spot should be included for each new home, as street parking has become increasingly challenging across the city.
Another crucial aspect of the plan is the firm stance against including any requirements for subsidized housing in new developments. Many state-level efforts to reform single-family zoning have mandated that developers include affordable housing, which has often deterred adoption by builders.
The coalition supporting this initiative includes various organizations, such as Rise up Residential and YIGBY (Yes in God’s Backyard) San Diego, who acknowledge the necessity of increased affordable housing options.
While the road ahead remains uncertain, proponents of the proposal maintain that changing the lot size regulation could catalyze a housing revolution in San Diego, potentially offering relief to both residents and the city’s finances.
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