Zoning
A local government land-use classification system that divides territory into districts and specifies permitted uses, building types, and density for each zone.
What is Zoning?
Zoning is the legal mechanism by which local governments (cities, counties, municipalities) regulate land use by dividing their jurisdiction into geographic districts—zones—and specifying what types of development and activities are permitted in each zone. Common zoning designations include: residential (R), further subdivided by density (R-1 single-family, R-2 two-family, R-3 multifamily); commercial (C); industrial (I); agricultural (A); and mixed-use (MU) combining residential and commercial. Zoning ordinances specify permitted uses (by right), conditional uses (allowed with a special permit after public review), prohibited uses, minimum lot sizes, maximum building heights, setbacks (required distances from property lines), floor-area ratios (FAR), and parking requirements. Property owners who wish to use land in ways not permitted by current zoning must apply for a variance (an exception to specific requirements) or a rezoning (a change to the underlying district classification). Zoning directly affects property values: land zoned for higher-density or commercial use is typically worth more than identically located land zoned for single-family residential. Investors researching a property must verify that their intended use is permitted under current zoning.
Example
An investor purchases a property zoned R-2 (two-family residential) with the intent to convert the basement into a third unit. The local zoning code prohibits three-unit structures in R-2 zones without a special use permit. To proceed legally, the investor must apply to the zoning board for either a variance from the density limitation or a rezoning to R-3—a process that typically takes 3–6 months, involves public notice and hearings, and may be denied. Failing to verify zoning before purchase is a common and costly mistake in investment real estate.