Can I determine the value of a lot if a zoning change is made ?

[Steve Hungerford]

Hello,

I have a decent sized 10,550 sq ft. lot with an (1930) old/small 1br house on it. Most of the value of the lot is in the land or potential. Its zoned RM-6, so only one multifamily dwelling unit can be placed every 6,000 square feet. So effectively one unit or less than Residential zoning would allow. Because of SB-9 in CA you can split residential lots and put a duplex on each, plus an ADU ( I believe). Multifamily should be increasing density not decreasing it from residential zoning.

I am interested in figuring out if trying to change the zoning will bring more value. I believe it takes a long time and have heard 15K application fee for a zoning change.

If zoning was changed to say RM-3, that would allow probably 3 multifamily units, depending on setbacks. How can I determine with more certainty what the land would be worth in this scenario ?

Can an appraiser figure this out ?

Land use planners usually tell me they don't calculate value but they can help with the zoning change and potential for it. 

Side note: The land used to be zoned commercial and was changed I believe in the 90's sometime. It would be a good commercial location because the land is on a busy street near other businesses.

Who could tell me how much the lot would be worth if zoning was changes to commercial ?

[Ryan Seib]

I would possibly start by contacting the municipal zoning administrator or staff. Ask them about the re-zoning process. You can find out from them the process, the fees, and whether what you want to do is feasible. Another possible starting point is talking to your real estate attorney. An attorney should be able to help you know what to say and what to ask before you talk to the zoning people.

For valuation, you are talking about value based on a development. So that highly depends on who the intended buyer/user is. For example if you are aiming for multifamily, it might be helpful to get some drawings. Then you can quote costs for drawings. You can present that to lenders for the financing piece. Another approach that works is comparing nearby properties. An appraiser should be able to give you a current appraisal. They should also be able to give a valuation estimate using the new zoning classification. They would carry out the same appraisal procedure, except they would use the new zoning for comparable property and so forth. You could also ask the city tax assessor how they would assess value with new zoning classification. In any case all you can do is estimate I believe. I hope this works out for you.