Los Angeles residents are reeling because of new ordinances restricting home sizes in 20 single-family neighborhoods.
Many are concerned that the restrictions, lasting up to two years, could have a destabilizing effect on the already volatile Los Angeles real estate market.
Interim Control Ordinances
On March 25, the LA City Council enacted two Interim Control Ordinances (ICOs) in direct response to complaints about the “mansionization” trend of building large homes (also known as McMansions) which outsize neighboring homes.
The Council considers recent construction of “hulking, box-like structures” and “bulky two-story additions” to be a “current and immediate threat to the public welfare” which will have “negative impacts to aesthetics and general quality of life.”
The goal of the ordinances, which will last anywhere from 45 days to two years, is to temporarily and immediately halt the “significant change” caused by mansionization.
The first ordinance prohibits the demolition and substantial alteration of homes in five Historic Preservation Overlay Zones (HPOZs),
The second ordinance limits the scale of new construction in 15 additional neighborhoods.
The Council plans to work on permanent regulations while the interim ordinances are in place.
News of the pending ordinances had developers rushing to build as many large homes as possible. Throughout Los Angeles, there are now hundreds of homes that are considered “illegal McMansions” pursuant to the recently enacted ordinances.
Mansionization
Mansionization refers to the practice of demolishing older homes and replacing them with the largest home possible, given the lot size.
In some Los Angeles areas, it’s not uncommon to see nearly 4,000 square foot homes on 6,000 square foot lots.
With a recent spike in real estate prices, mansionization has become a hot topic.
Neighbors have been complaining that these “McMansions” tower over their homes, simply don’t match and compromise the character and aesthetics of the neighborhood. Others argue that the mansions compromise their privacy because they are built too close to existing properties.
One Beverly Grove resident claimed: “Developers are ruining my lovely, 1920’s Los Angeles neighborhood with giant white stucco boxes, built to the property line and looming overhead like Godzilla in Tokyo.”
Some are also frustrated by local governments’ handling of the issue and complain about “variances on developments being given out like candy on Halloween” and “sweetheart deals being given to developers.”
2008 Baseline Mansionization Ordinance
The Baseline Mansionization Ordinance (BMO) was originally enacted in 2008 to limit the size of new and renovated homes, based on lot size.
Since then, however, the ordinance has been harshly criticized for “loopholes” allowing homeowners and developers to circumvent the restrictions, erect massive homes and deprive neighboring homeowners of privacy and sunlight.
For example, under the original ordinance in the Westwood area of Los Angeles, simply complying with special “environmentally friendly guidelines” or specific setback requirements allowed for a 20% square footage bonus.
Once a few developers caught on, massive development projects once again became the norm.
Fast forward almost seven years later and Councilman Paul Koretz has implemented a temporary solution. The new restrictions aim to close the loopholes and once and for all put an end to the mansionization of Los Angeles.
While the ICO is in place, Koretz, working with the Department of City Planning, will prepare permanent amendments to the BMO which will permanently remove any bonuses and exemptions allowing homeowners and developers to build “McMansions.”
Who Will Be Impacted?
Five of the 20 neighborhoods affected by these regulations, pursuant to Final Ordinance No. 183496, are Sunset Square, CarthaySquare, Holmby-Westwood, Oxford Square and the Berkshire Craftsman district of El Sereno.
These specific neighborhoods were targeted for historical preservation.
Demolition of all single-family homes are banned in these HPOZs.
The other 15 affected neighborhoods, pursuant to Final Ordinance No. 183497, which have had a higher than usual level of new construction activity, are Valley Village, South Hollywood, La Brea Hancock Neighborhood, The Oaks of Los Feliz, Miracle Mile, Larchmont Heights, Lower Council District 5 (Westwood), Beverlywood, Inner Council District 5, Fairfax, Bel Air, Faircrest Heights, Kentwood, Mar Vista/Venice and Old Granada Hills.
The restrictions applying to homes in these areas vary widely.
Westwood (Lower Council District 5)
In Lower Council District 5, which includes Westwood, bonuses for building greener houses with front and second story articulations will no longer be given.
Prior to the ICO, a 20% square footage bonus was given to houses that incorporated either of these exceptions.
A single family house that used green technology and received a certificate of compliance through the U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) program was granted the 20% bonus. LEED houses are environmentally friendly and save money while promoting renewable and clean energy.
The front facade articulation and proportional stories bonuses were intended to avoid the building of box shaped houses without setbacks that weren’t aesthetically pleasing. Second and subsequent stories had to be no larger than 2/3 of the first story. Since the bonuses no longer apply, builders are no longer required to build a house with a particular look to take advantage of available square footage.
For example, prior to the ICO, you could build a 4,600 sq. ft. house on a 7,400 sq. ft. lot (800 sq ft of which was the 20% additional bonus). Under the new restrictions, you would only be able to build a 3,700 sq. ft. house, which is almost 1,000 sq. ft. smaller.
A map showing the exact areas subject to the ordinance in Los Angeles’ Lower Council District 5.
Beverlywood and Fairfax Area
Houses built in the Beverlywood and Fairfax area will still receive bonuses for green features but will be limited to 15% square footage bonuses. Prior to the ICO, builders were entitled to a 20% of bonus space under green and architectural exceptions.
Accordingly, The Beverlywood’s restrictions are not as strict as the Westwood restrictions. Some who oppose mansionization in Beverlywood argue that the 15% limitation is not enough.
Bel Air
Bel Air restrictions govern how much dirt can be moved when rebuilding (6,000 cubic yards) since homeowners there complained about pollution and safety issues caused by trucks making multiple trips up and down residential streets.
This restriction will come as a major disappointment for those planning to build homes in an area which is known, worldwide, for its very large homes.
Kentwood, Mar Vista/East Venice
Under previous rules, builders were eligible for 20% to 30% space bonuses for using environmentally friendly methods or facade scaling. These bonuses are now eliminated.
La Brea Hancock, Miracle Mile and Larchmont Heights
In these areas, newly constructed homes cannot exceed 20 percent of the size of the demolished home. For example, if a 2,000 square foot home is demolished, it could not be replaced with a home exceeding 2,400 square feet.
The Oaks of Los Feliz
Basements will be included allotted square footage in the Oaks neighborhood of Los Feliz.
Ordinance Critics
Many feel victimized by the ordinance since thousands of homeowners are now subject to restrictions caused by the actions of a handful of aggressive real estate developers. They contend that they should be allowed to build larger homes to accommodate their growing families.
Others feel that the imposition of these restrictions will create disparity by devaluing smaller homes and increasing the value of larger homes.
Some find it ironic that many residents so vehemently supported enactment of the ordinances since they effectively lowered the value of their own homes. The fact is that not all of the new homes being built are “boxy,” real estate values have been rising and imposition of restrictions could have a devastating impact on home values.
Many contemplating purchasing homes in the areas impacted by the ICO may reevaluate given the negative implications they may have on the real estate market.
Will potential homeowners invest in an areas precluding the option to expand and build a larger homes? Especially if all of the smaller homes in the area were originally built decades ago. For example, most of the smaller homes in the Westwood area of Los Angeles were built over a half a century ago.
Those who have recently purchased in affected areas, with the intention of rebuilding a larger new home in place of a smaller old home, will now have to deal with the restrictions imposed by the new ordinances.
The Road Ahead
With two different schools of thought surrounding the mansionization trend, it will be interesting to see who emerges victorious when the interim ordinances end and the permanent ordinances are put into place.
Time will tell what impact the ordinance will have on pricing and inventory in parts of Los Angeles which are and are not subject to the ordinances.
Will prices of small homes drop in areas like Westwood? Will prices increase in areas which aren’t subject to the ordinances?
With so many variables, like potentially rising interest rates, in play, these are difficult questions to answer.
In an already overcrowded city with thousands of potential homeowners looking to build larger homes, it will surely be an interesting road ahead.
Stay tuned for the latest updates.
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