SB-423 in Carlsbad: A Quick Guide for Investors and Agents

[Felicia Nitu]

Hello BiggerPockets Community!

For real estate investors and developers exploring Carlsbad, SB-423 offers a streamlined pathway for multi-unit housing projects. This California law eliminates much of the red tape by bypassing environmental reviews and subjective local approvals, creating a faster and more predictable development process. Investors can fast-track their timelines and boost ROI, while agents can use these streamlined rules as a selling point to attract development-minded buyers.

In Carlsbad, SB-423 projects are allowed in residential or mixed-use zones near urban areas, with 75% of the site’s perimeter needing to border developed spaces like homes or businesses. But not all land is fair game. Earthquake fault zones, flood plains, and high fire hazard areas are off-limits. You'll also need to avoid environmentally restricted spots, including wetlands, protected habitats, and prime farmland. Knowing these boundaries can help you zero in on profitable, compliant locations.

Timing is crucial when it comes to approvals. For projects with 150 or fewer units, the city has 60 days for eligibility review and 90 days for final approval, including design review. Bigger projects (more than 150 units) have a 90-day eligibility review and a 180-day final approval deadline. To keep these approvals valid, developments should secure public investment to support housing affordability and ensure that at least 50% of the units are affordable. Hitting these targets could be the key to unlocking lasting investment returns.

Before diving in, developers need to complete pre-submittal steps, including issuing a "Notice of Intent." Carlsbad officials are required to notify Native American tribes within 30 days, and tribes have 30 days to respond if cultural resources might be affected. If no agreement is reached, the project becomes ineligible for SB-423. In moderate- or low-resource areas, developers also need to hold a public meeting within 45 days to gather feedback. Addressing community concerns upfront isn’t just a requirement, it’s a smart move for standing out with well-received projects. This info also gives agents the edge in guiding clients, setting them apart as the go-to experts in Carlsbad’s fast-moving market.

If you're curious about how SB-423 can work in other parts of California, definitely check out It's Time to Invest in California, now! The zoning changes will make California a hot real estate market. With zoning changes making California’s real estate market even more attractive, now’s a great time to dive in. I’ve done a lot of research on these projects, so feel free to ask any questions here. I’m happy to help and share what I’ve learned!