Zoning in real estate: everything you should know

Are zoning laws, codes, or downzoning terms coming up as you prepare for your real estate license exam? Have you found yourself questioning what these terms actually mean or how they might be presented on your test day? If so, you’re in the right place. In this article, we’ll delve into the world of zoning and explore its significance together.

Zoning real estate definition

Zoning laws are local government regulations dividing land into different districts and specifying the uses allowed in each.

To ensure you understand this concept clearly, let’s use this analogy: A school cafeteria has different sections: one for hot meals, another for salads, a third for desserts, and so on. Each section has a specific purpose; you wouldn’t expect to find a cake in the hot meal area. Similarly, zoning laws divide a city or town into particular sections, each with its designated purpose.

Zoning laws are a prime example of police power in action, the authority granted to state and local governments to enact legislation that preserves public health and general welfare.

Some of the regulations that zoning laws can dictate are:

• The types of uses that are allowed in each district (e.g., residential, commercial, industrial)
• The size and type of buildings that can be constructed
• The location of buildings and other structures on a property
• The amount of parking that must be provided
• Landscaping and other requirements

How can zoning laws be beneficial to a city’s residents?

Zoning laws bring several benefits to the residents of a city. They’re like the rules that help maintain order and balance within a community. Here are a few ways zoning laws can be beneficial:

• Preserving neighborhood character: Zoning laws help preserve the unique character of different neighborhoods. By designating specific areas for residential, commercial, or industrial use, these laws ensure that incompatible developments don’t disrupt the charm and atmosphere of the residential regions.

• Managing noise and traffic: Zoning laws are also beneficial to a city’s residents. Separating residential zones from busy commercial or industrial areas makes the neighborhoods quieter and safer for residents. They also help reduce traffic congestion and ensure smoother transportation flow.

• Enhancing quality of life: Zoning laws often include provisions for parks, open spaces, and recreational areas. These regulations promote a higher quality of life by ensuring residents can access green spaces and playgrounds.

• Protecting property values: Zoning laws help protect property values by maintaining a balance between different types of land use. Imagine if a noisy factory popped up in a peaceful residential neighborhood; it could significantly impact property values.

• Promoting safety and security: They often incorporate safety regulations and building codes. These regulations ensure that structures meet safety standards and that essential services like fire stations and hospitals are conveniently located to serve residents effectively.

• Fostering economic development: Zoning laws can stimulate economic growth within a city. By designating specific areas for commercial or mixed-use developments, these laws attract businesses, create job opportunities, and boost the local economy.

By maintaining order, setting aside green spaces, and ensuring adequate infrastructure, zoning contributes to a healthier and more aesthetically pleasing environment. Zoning laws can greatly benefit a city’s residents through these measures, safeguarding community character and promoting a comfortable, safe, and enjoyable living environment.

Zoning codes definition

Zoning codes are land use regulations that define what is allowed to be built and where it can be built. Municipalities use zoning codes to separate land under their jurisdictions into zones of allowable development. In some cases, a municipality will publish a zoning map. Three factors typically determine these zones:

• The use or activity taking place on the ground or buildings built there.
• The shape of buildings, i.e., height and relationship to the adjacent public right of way.
• Lot size and the bulk or the size of a building and how it orients on the property.

Zoning classifications

The classification under residential zoning is the most significant and asked in the exam, but let’s also explore other types; they are worth knowing too.

Residential zoning

Residential zoning primarily focuses on land use for housing purposes. It’s all about creating neighborhoods and areas where people can live and establish their homes. They typically include various housing types, such as single-family homes, townhouses, apartments, and condominiums.

Residential Zoning Codes:

• R-1 (Single Family Residences): This zone typically allows for single-family homes on individual lots. It’s characterized by low population density and often restricts other structures.

• R-2 (Duplexes and Multi-Family Homes): In an R-2 zone, you’ll find duplexes, townhouses, and other multi-family residential buildings. It permits higher density than R-1.

• R-3 (Multi-Family and Apartment Buildings): R-3 zoning allows for apartment complexes, condos, and other multi-family dwellings. It’s suitable for higher-density residential development.

Commercial zoning

Commercial zoning determines where certain types of commercial activities can take place. Under commercial zoning, various units are typically included, such as office buildings, shopping centers, hotels, nightclubs, restaurants, and even vacant land that holds potential for future business development.

Industrial zoning

Industrial zoning is an area designated for businesses that operate in an industrial capacity. The placement of these zones depends on environmental factors like noise levels and air quality. They accommodate activities such as large warehouses, airports, and manufacturing facilities.

Agricultural zoning

In effective agricultural zoning, the land is either exclusively or almost exclusively for agricultural uses. This designation protects agricultural land and ensures farmers have the necessary space for their work. It also maintains the rural landscapes and preserves farmland. Among the farm structures that can be built on agricultural land are the barns, livestock shelters, and silos.

Special purpose zoning 

Special Purpose Zoning refers to designations that address specific, unique, or specialized land uses within a municipality or jurisdiction.

It caters to specific needs like airports, schools, hospitals, parks, and religious institutions. For example, a special purpose zone may be designated for a hospital or medical campus to ensure that it meets the specific requirements for healthcare facilities, including adequate space for patient care, parking, and accessibility.

Mixed-use zoning (MU) 

Mixed-use zoning combines residential, commercial, and sometimes industrial uses within the same area. The concept behind mixed-use zoning is to create vibrant and walkable communities where people can live, work, and access amenities within close proximity. In a mixed-use zone, you might find a blend of residential buildings, commercial establishments, offices, and even recreational spaces all coexisting.

Zoning and its relation with a master plan

Zoning is not some code and area limitation; it is part of a city’s structure and how it is built. For example, they are essential to a city’s master plan.

A city’s master plan acts as a blueprint for its growth and development, detailing how land should be used and what the community will look like in the future. It’s a broad strategy that considers everything from housing and transportation to parks and infrastructure.

Zoning ordinances are then crafted to align with this master plan, ensuring that each piece of land is used in a way that fits into the bigger picture of a harmonious, well-functioning city.

Types of exceptions within zoning laws

Grandfathered property and zoning laws

When a property’s use or structure conforms to zoning regulations when it was built or established but later finds itself out of compliance due to new zoning laws, it may be “grandfathered” in. The property can continue its use despite failing to meet the new zoning requirements.

Characteristics of grandfathered property:

• Limitations on changes: Generally, grandfathered properties face restrictions on expansion, reconstruction, or significant alterations that would further deviate from current zoning laws. Minor changes might be permitted, but anything considered a significant alteration could require the property to comply with all current zoning regulations.

• Transferability: The rights to continue a nonconforming use can often be transferred to new owners if the property is sold. However, this is subject to local laws and the specific terms under which the nonconforming use was established. Some jurisdictions may have sunset clauses that phase out nonconforming uses over time, especially if the property undergoes significant changes or the use is discontinued.

Zoning and variances

Variances are permissions granted by local zoning authorities that allow property owners to deviate from specific requirements of the zoning laws. Variances are typically sought for issues like setbacks, building height, or lot coverage that don’t conform to the current zoning regulations. There are generally two types of variances:

• Area variances: Allow deviations from zoning ordinances relating to structure size, height, or placement.

• Use variances: Permit land use that is not generally allowed in the zoning district. They are more challenging to obtain because they can fundamentally change the character of the neighborhood.

Special use permits (conditional use permits)

Special Use Permits, also known as Conditional Use Permits, allow a property to be used in a way that is not normally allowed within that zoning district only if the use meets specific conditions laid out by the zoning authority. This mechanism might be compatible with the existing zoning under certain conditions, such as schools in residential zones or small businesses in primarily residential areas.

Zoning amendments or rezonings

A zoning amendment or rezoning is a process where the zoning classification of a property or area is changed to allow for different uses than those currently permitted. Rezonings are generally pursued by property owners who want to develop their property in a way that is not permitted under the existing zoning designation.

Downzoning and upzoning 

As you already read, the zoning laws or ordinances may change over time; that’s when actions like downzoning and upzoning come into play.

Downzoning refers to a change in zoning classification that results in reduced density or a shift to less intensive land uses. For example, changing a zoning classification from commercial or multifamily residential use (which allows higher-density development) to single-family residential use (which permits lower-density development) is a downzoning.

On the other hand, upzoning involves changing the zoning classification to allow for higher density or more intensive uses than previously permitted. This might include shifting from single-family to multifamily residential to commercial zoning.

Summarizing

In summary, zoning laws significantly influence what can be constructed, where it can be built, and how it can be used. Questions about zoning codes and regulations are common on the real estate exam. Do you want to prepare more? Start Lexawise’s exam prep today!