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A Development Boom in the Cards for Santa Monica?

Posted by John Hathorn on November 2, 2022
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Is this a trick or a treat?
A development boom in the cards for Santa Monica? 

It appears the City’s failure to produce a compliant Housing Element in 2021 may be causing developers to take advantage of a “builder’s remedy” loophole. This loophole limits the ability of a city or other jurisdiction to deny applications for new housing developments while its housing element is out of compliance. While Santa Monica zoning ordinances were suspended, 4,000 new housing units were set to be approved, including a 15-story residential building at Nebraska and Stanford.

According to the 2019 law governing Housing Element documents, in the event the Housing Element of a municipality is rejected by the California Department of Housing and Community Development (HCD), the HCD removes the ability of the municipality to have a say in specific housing projects’ approval or rejection through the “Builder’s Remedy” application process.

More recently, just days after this news was announced, the California Department of Housing and Community Development (HCD) confirmed Santa Monica’s updated Housing strategy, closing the opening for developers created when the same agency refused to certify an earlier version of Santa Monica’s framework. While the state’s approval means Santa Monica regains control over which projects it approves, that control does not apply retroactively, so certain projects submitted during the window while the city was noncompliant were automatically given the green light, and approvals are still valid. This does not mean that these projects will all be built but some of them certainly will.

Also in Santa Monica News, and this is BIG for our North of Montana residents…

On November 1, 2022, the Traffic Services Division of the Santa Monica Police Department says they WILL begin to enforce Santa Monica Municipal Code section 3.12.380. This Ordinance prohibits driving or parking a vehicle on any sidewalk, parkway, or curb, other than a driveway or roadway. A “parkway” is the area of the public right-of-way not intended for vehicular use and refers to the portion of a street other than a roadway or a sidewalk. The parkway commonly sits between the sidewalk and the street curb. Parkways can also be located where no curb exists between the sidewalk and the roadway where which the City has reserved for landscaping and utilities. The Ordinance also prohibits parking on the “driveway apron,” the portion of a driveway between a property line and any curb.

Any person violating the Ordinance is subject to a parking citation with a fine in the amount of $63 per violation.

The City is committed to ensuring that its streets, sidewalks, and public-right-of way areas are safe, accessible, and equitably available for all residents and visitors.

There are a few of my clients that want to organize opposition to this enforcement as they have large wide aprons and never block sidewalks while using them. Call me if you want to be added to the list.

For more information, call 311 or email 311@santamonica.gov

Courtesy of https://santamonica.gov/

Did You Know?

* High inflation ….or free-market opportunistic profit? United Airlines – one entity the taxpayer subsidized with billions of dollars during the pandemic – just posted record earnings….and profits. While most attribute higher airfares to rampant inflation and high energy costs, United’s results reveal their profits SOARED…..revenue per available seat mile was 25.5% higher than the same quarter …in 2019. Travel demand is historically high as hybrid work allows people to take more trips with more flexibility. With high demand and fewer planes and staffing, prices and profitability are up, up, up. A product of free markets/capitalism…except of course that little part where the government bailed these companies out with $25 billion of our tax dollars (some will be paid back with interest). (CNBC)

* Building permits (1.564M vs 1.540M estimates) and housing starts (1.439M vs 1.470M estimates, down 8.1% vs 6.7% estimates) show that supply is not ramping up to meet future demand and is actually slowing. (CNBC)

* Investors are unloading securities sold by Fannie Mae and Freddie Mac that shift the risk of mortgage defaults away from taxpayers, a sign of growing concern about defaults if rising interest rates cause a severe recession. The securities, called credit-risk transfers, could incur losses if rising defaults creep into the massive swaths of mortgage debt backed by the housing-finance giants. (WSJ)

* The rich love electric cars, priced similarly to the median price of a US home! Rolls Royce sales are up almost 50% in 2022 in case you were worried…. and their new $400,000 EV has hundreds of pre-orders as RR plans to be all electric by 2030. Cadillac has a $300,000 EV coming too. Hopefully we have enough electricity to fuel all these new cars….. my electrician is concerned! Homes that create power could be a massive future value-add.

Market Report – Santa Monica

How’s the market? A Slight Seller’s advantage. This week the median list price for Santa Monica, CA 90402 is $6,825,000 with the market action index hovering around 41. This is less than last month’s market action index of 43. Inventory has increased to 26.

In the last few weeks the market has achieved a relative stasis point in terms of sales to inventory. However, inventory is sufficiently low to keep us in the Seller’s Market zone so watch changes in the MAI. If the market heats up, prices are likely to resume an upward climb.

Here’s your North of Montana Real Estate Update

There are currently 20 active listings North of Montana Avenue in Santa Monica.

Since my last DIRT there have been NINE new listings!

722 21st Street– Listed by Pence Hathorn Silver for $5,495,000. This is a charming single-story Spanish home with exceptional privacy and nice updates while maintaining the original character.

150 Esparta Way – Listed for $13,500,000. This is a large 8,800 sqft Spanish Colonial was built in 2006. It sits on a large, almost 20,000 sqft lot with pool and sports court.

615 23rd Street– Listed for $14,995,000. This beautiful new construction architectural is still under construction with completion expected in the Summer of 2023. Approximately 7,000 sqft on 4 levels plus a detached ADU and pool.

2406 La Mesa Drive – Re-Listed for $12,995,000, down from an original list price of $14,750,000. Charming 1929 Monterey Colonial Revival on a magnificent 30,000 sqft lot surrounded by mature landscaping. The home, designed by architect George Holstein, has been featured in Architectural Digest.

2020 Georgina Avenue – $17,500,000. Originally built in 1913 and extensively renovated, this nearly 7,000 sqft home is situated on a large double lot and is surrounded by lush landscaping with an impressive pool. Last sold in 2021 for $11,850,000.

734 25th Street – Listed for $6,950,000. Built in 2003 this Mediterranean style home has a classic floorplan with 5,800 sqft on 3-levels. Last sold in 2006 for $4,385,000.

1011 Georgina Ave – Listed for $12,499,000. Modern new construction architectural! Almost 8,500 sqft including an ADU. Meticulous design inspired by nature. Features elevator, pool and rooftop deck.

426 Georgina Ave – Listed for $10,995,000 and headed for a price reduction. Single-story 1922 Traditional on a 22,000 sqft West of 7th lot. Ready for updating.

528 18th Street – Listed for $6,645,000. Nicely updated Traditional home with guest house. Last sold in 2019 for $4,485,000.

There are 5 in escrow-

518 Euclid Street – Listed for $3,950,000.

724 Euclid Street – Listed for $3,300,000.

472 23rd Street – Listed for $4,895,000.

304 14th Street – Listed for $5,495,000.

611 10th Street – Listed for $4,480,000.

Four have sold since my last update-

707 21st Place – Sold for $5,250,000. Originally listed for $5,495,000.

214 15th Street – Sold for $4,475,000. Originally listed for $4,895,000.

439 21st Street – Sold for $4,200,000. Originally listed for $3,995,000.

825 Woodacres Road – Sold for $11,351,000. Originally listed for $14,950,000.

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