What is Zoning?

Zoning regulations govern land use, determining the types of buildings developers can construct, locations for these structures, and permissible activities. It’s crucial for anyone venturing into real estate investment or development to understand these regulations, sometimes called urban regulation, development guidelines, or municipal coding.

Zoning regulations divide an area into separate zones that each have different rules for use. These regulations specify the building height and materials, lot sizes, parking rules, noise levels, and the required distances between buildings. These rules aim to minimize conflicts and protect communal interests.

Such guidelines also dictate what developers can build on a property, how close it can be to neighboring properties and their possible hours of operation. Due to these land-use guidelines, zoning divides cities into districts with specific residential, commercial, and industrial uses. The city planning commission determines the permissible constructions in each district. Local governing bodies at the municipal level usually establish and approve these municipal codes.

Zoning Symbols and Differences

Each symbol represents a different category under urban regulations, and each has its own rules that apply to all properties within the category. The most commonly-used zoning categories include Residential, Commercial, Industrial, and Mixed-Use.

Residential

Under district guidelines, the residential category encompasses all properties people use for living purposes. This includes single-family and multifamily homes, duplexes, townhomes, condominiums, and apartments. Residential zones also cover single-family detached homes, nursing homes, and convalescent homes.

Commercial

Primarily, commercial zones serve establishments that produce and sell goods and services. Commercial zones include factories, warehouses, office buildings, department stores, and shopping centers.

Industrial

Industrial properties mainly produce goods and services for their use, such as manufacturing, research, development, warehousing, or processing. Industrial zones include factories, warehouses, and power plants.

Mixed-Use

Mixed-use districts allow commercial and residential activities within single or multiple properties. This zoning typically includes properties such as retail stores with residential apartments above the store or office buildings with commercial and residential units.

R1 Zoning

R1 zoning is the most restrictive form of residential zoning and is used for single-family detached homes. R1 zoning commonly appears within larger residential zones, like R-MH (multi-family) zones. Moreover, R1 areas typically emerge in surroundings where properties serve commercial or industrial purposes, as well as in areas where existing residents are opposed to new residential construction.

R2 Zoning

R2 guidelines allow the construction of single-family homes on smaller lots than standard ones for R1 zoning. This is usually found in areas with many existing homes near commercial or industrial uses, where there is a need for smaller lots. In these cases, residents typically don’t want the noise associated with more significant commercial or industrial properties.

R4 Zoning

R4 districts are essentially designated for commercial activities with smaller lot sizes and higher building restrictions. R4 zoning is typically found in areas near commercial and industrial uses where there is a large amount of commercial and industrial zoning and limited developable property on which to construct new commercial or industrial buildings.

Common Zoning Laws

Though specific zones and use cases vary across cities and states, there are three stipulations that are common to most zoning laws across America.

• Maximum Lot Size: According to most zoning laws, there’s a maximum allowable size for any given lot. Should a property be subdivided into two or more parcels, their combined sizes cannot exceed the maximum stipulated by these laws.
• Minimum Lot Size: Some zoning laws specify minimum allowable lot sizes. If zoning laws demand smaller lot sizes, developers must adhere to the minimum lot size requirements.
• Building Height: Building height measures from the ground to a building’s highest point, including the roof and any other architectural elements. Zoning laws usually specify the maximum allowable building height for a given zoning category.

Zoning Ordinances

Zoning ordinances document the rules and regulations for a specific zoning category. They include the following:

• Purpose and intent: The purpose and intent of a zoning ordinance are to guide and regulate a city’s land-use planning by identifying areas appropriate for different uses, regulating the type and quality of new construction, and encouraging and promoting socially responsible land uses.
• Districts:  Land is divided into districts based on the type(s) of land use appropriate for a specific area.
• General standards: General standards that apply to all zoning districts. For example, general standards may include lot size, building height, and setback requirements.
• Special standards: Unique standards that apply only to specific zoning districts. For example, certain standards may include provisions related to parking, building materials, and the timing of demolition.

For real estate investment, understanding land-use regulations is crucial. Investors need to comprehend a property’s zoning to grasp what uses are permissible, such as the type of housing that can be built on the lot, what types of commercial businesses can be built close to the property, and what types of utilities can be built in the area. Investors should integrate the identification of a property’s use regulations into their due diligence.