Zoning. It doesn’t have to be the monster under your bed. By Jen Hudson

This next sentence may be one of those “no, duh!” type statements, but just hear me out.  Cities, towns and counties are usually made up of different land use zones, or areas that are clearly-defined on a zoning map.  Things like residential, office, or industrial uses, etc.  Then, usually within the general use is a much more restrictive set of rules and allowed uses for the building and/or business that is permissible there.

In theory, these different land use zones are tools that city or county planners use to control things like traffic, density, services, etc.  In most cities (I’m sure there is an exception somewhere), you don’t want to buy a hamburger across the street from the city dump. We make industrial zones so that the big trucks and equipment noises at 5am are away from the residential neighborhoods.  We like industrial properties to have access to rail lines and ports, when possible.  We don’t put schools on freeway ramps.  Business lunch hours go great with easy access to food locations.  You get the idea.

Most cities or counties have separate areas that are commercially zoned for specific business uses.  As a general statement, we’re pretty good at mixing office and retail locations.  Medical office buildings might be a different story.  Mini-storage works well in certain areas.  Golf courses might be an exception or conditional use.  Marijuana grow houses have become a new issue (I’ve honestly never used the product, but I-502 has forced me to become fairly familiar with the business side of it).   Oh, and don’t forget about agricultural zones too.  We do need farmland… and forests!  Ok, enough of that.

Why do I bring this up?  Well, it seems it has become more of an issue recently.

This is not a debate about the economy.  In general, it’s a lot better today than it was 5 or 6 years ago. With that, we’re seeing some changes with “re-zoning” or “up-zoning” in many municipalities. As local economies improve, developers build, and then cities or counties need improved and expanded infrastructure to support these additional services and population.  Things like wider roads, more sewer lines, lights, sidewalks, etc.  Of course, that ultimately means more in taxes to pay for it.  At the heart of it, development supports those taxes, which in turn support the people.  It’s a cycle.

You thought you owned a single family home in a rural location where the minimum lot size was 2.5 acres (equals 108,900sf).  Now, that has been annexed into the city or has become part of the “urban growth area” or UGA, and all of a sudden you can have a 9600sf lot.  In theory, can you put 11 homes where you once had just one?  Maybe.

Even better, can you find that 2.5 acre rental house and hang on until you can make 11 homes yourself or sell it to a developer?  Get ahead of the curve?  Maybe.

We’ve seen local areas recently that were used for industrial purposes, but as the cities expanded they were turned into multi-family use land for apartments or office and retail space instead.  As employment improves and business expands, it brings more people to the area and those people need somewhere to live.  Of course, that forces the industrial tenants to move out further, which keeps compounding the situation and infringing into even more rural areas that were farmland or forests.  See how this works?

So what is my point?  My point is this.

You need to be aware of the changes that are going on around you.  Re-zoning or up-zoning is real.  It might work to your benefit if you have a house that can now be used for business, or it might work against you if the city changes are ahead of what the market is demanding.

Like I said before, if you can get ahead of the curve and start investing in locations that may be developed soon, you could see a real nice payoff sooner than later.  A couple years ago, I accidentally bought a little rental house that will soon be in walking distance of a new college campus.  All of a sudden, that little property has a lot brighter future and probably a lot more stable rent.  That got me thinking.. where else can that happen?

Real estate is just economics.  And economics is sexy.  It’s supply and demand.

Want to look for opportunities in your market?  Do you know someone who might be impacted by a coming change?  I’ll tell you want is going on and whether it’ll work in your favor.  Call/text (206) 293-1005, or send an email to: Jen@HudsonCREG.com.  You can find me any day except Sundays.



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