Zoning Out: Why We Have Zoning Laws, and How They Shape California and Society (Not Always For the Best)

In 1908, California became the birthplace of zoning, the system of local laws that dictates how land in a city or town can be used—not only what can be built and where, but how much. Zoning laws divide land into four general categories: residential, commercial, industrial, and agricultural. There are numerous variations on each category, and some other lesser-used, more specific categories. But broadly, those are the four permitted uses of land determined by the zone in which it is situated. 

Why do cities and towns divide land into zones? Ostensibly, to promote orderly development, keeping control of traffic flow, noise and activity levels to make sure all are appropriate to each specific neighborhood. If you live in a quiet, residential neighborhood you don’t want an auto mechanic setting up shop next door. Or a slaughterhouse. Zoning prevents that.

But zoning has another function that may be even more important to homeowners and real estate investors. How land is zoned has a significant effect on the value of that property. Exactly how and to what extent zoning affects property values is the subject of seemingly never ending debate. At the least, zoning affects the supply of housing, and under the economic principle of supply and demand, that causes prices to go up or down.

Zoning has also historically functioned as a tool of social engineering, one with an especially significant part to play in enforcing racial segregation.

The Whole Country Zones Out

Zoning laws now permeate, even dominate the United States. The only American city of any significant size without zoning laws is Houston, TX. And even that city has a relatively robust set of regulations that govern where certain types of businesses or structures may be located. For example, in Houston, an oil well cannot be constructed within 400 feet of the nearest home, while a strip club must be located no closer to a residence than 1,500 feet. 

The country’s first zoning law was in reality legalized racial segregation, something that would become a regular feature of zoning laws as they spread across the country. 

The 1908 law, the Los Angeles Residence District Ordinance, banned a wide range of businesses from residential zones—most notably “wash houses,” which was the term for laundry businesses generally owned by Chinese immigrants and their families. So the country’s first zoning law was in reality legalized racial segregation, something that would become a regular feature of zoning laws as they spread across the country. 

The most common type of zoning in California and throughout the United States is residential zoning, which restricts certain areas to homes and some small businesses. And the most common type of residential zoning is single-family zoning, which bans apartments, duplexes and any type of structure that, as the name implies, allows more than a single family to live on one lot. 

America is a Single-Family Country

According to a study conducted by the New York Times in 2019, 75 percent of land in many American cities is zoned “single family,” meaning that building anything other than one structure occupied by one family is outlawed. In San Jose, the study found 94 percent of the city’s land carries single-family zoning. 

Los Angeles is right at 75 percent. A 2022 study run by the Othering and Belonging Institute at UC Berkeley found that 78 percent of land in the Greater Los Angeles Region was zoned for single-family homes only. In other words, if you are an apartment dweller, more than three-quarters of the Los Angeles area is off-limits to you, as a potential home.

What gives governments the power to zone? That is, why can local officials tell citizens what they can and can’t do with their own property?

Zoning is everywhere, but what gives governments the power to zone? That is, why can local officials tell citizens what they can and can’t do with their own property? Especially in an era when California and other states face a shortage of housing. In a situation where available housing is often priced beyond the means of an ordinary citizen, don’t zoning regulations only create even more restrictions—making prices higher and the supply of housing even more scarce?

Zoning in the Progressive Era

At the dawn of the 20th century, America was coming out of a period that came to be known as The Gilded Age—an era when builders and industrialists had essentially free reign over the country. These tycoons piled up wealth as they launched the United States into a future dominated by railroads and factories—by any means necessary. 

By the turn of the century, a new generation of Americans believed they were paying for the excesses of the Gilded Age business barons and political bosses. They started the Progressive movement, which attempted to steer the country’s breakneck economic growth in a direction that actually made living conditions better for the poor, gave factory laborers a more humane workplace, and reigned in the Gilded Age’s rampant political corruption.

Progressives, unlike the tycoons of the previous era, wanted progress to proceed efficiently, in an orderly and honest way. The Progressives were not revolutionaries, they were reformers. They didn’t want to overthrow the system—they wanted to make the system work better.

In the Gilded Age, cities became giant engines of industrial production. In what started out as a mostly rural nation, people rushed to the rapidly expanding cities. By 1920, according to the U.S. Census Bureau, for the first time the majority of America’s population lived in urban areas.

Progressives did not oppose growth, but they believed that development and construction needed to be regulated, so that cities would benefit the people who lived in them, not just the ones who built and controlled them. Slums and ghettos proliferated in the newly crowded, economically stratified cities. Progressives saw urban planning as a tool to contain the afflicted areas, keeping the perceived social ills they supposedly spawned under control.

Benjamin Marsh, one of the leading urban planners of the Progressive Era, saw zoning as a means to alleviate the brutal congestion in the poorest neighborhoods of large cities. But Marsh’s good intentions weren’t shared by many of his colleagues. 

"What began as a means of improving the blighted physical environment in which people lived and worked," according to U. Penn urban planning scholar Yale Rabin, became "a mechanism for protecting property values and excluding the undesirables."

The so-called undesirables were African-Americans and immigrants.

Racial Segregation and Zoning

Though the early urban planners were driven by a desire to impose some sort of order on seemingly chaotic cities, the result was often racial segregation, as with the 1908 Los Angeles zoning law. 

Two years later, the potential for zoning to enforce racial segregation spread across the country to Baltimore, MD, where a 1910 law passed that was designed specifically to keep Black residents confined to ghettos.  

“Blacks…should be quarantined in isolated slums in order to reduce the incidents of civil disturbance,” the city’s mayor stated. “To prevent the spread of communicable disease into the nearby White neighborhoods, and to protect property values among the White majority.”

If you are an apartment dweller, more than three-quarters of the Los Angeles area is off-limits to you, as a potential home.

The Baltimore zoning ordinance was more flagrant in its racial targeting than the Los Angeles one which at least couched its anti-Chinese racism in the pretext of excluding industrial development in residential areas. In addition to laundries, the zoning ordinance also excluded slaughterhouses (a particular concern of many early zoning laws), machine shops, funeral homes, lumberyards and other “nuisance” businesses. At the same time Los Angeles also passed the Industrial District Ordinance, which created seven industrial zones where those types of businesses were allowed.

After the Baltimore ordinance passed, racially targeted zoning laws spread rapidly, especially in Southern states. Blatantly racist zoning continued until 1917 when the Supreme Court in the case Buchanan v. Warley ruled that racial zoning violated the Fourteenth Amendment which guaranteed, Justice William R. Day wrote, “the colored race the enjoyment of all the civil rights…enjoyed by white persons." 

The city had a right to impose zoning laws to promote “the public health, safety, and welfare,” but those laws may not "deny rights created or protected by the Federal Constitution,” Day wrote, for the unanimous court.

New Ways to Use Zoning for Segregation

Cities continued, however, to find other ways to use zoning ordinances to keep certain neighborhoods for whites only. The use of “exclusionary zoning” became widespread, meaning zoning laws that rather than openly target a racial group instead restricted certain zones to uses that would be available primarily to more affluent whites. 

Single-family zoning was perhaps the most widely used form of exclusionary zoning, and the landmark 1926 Euclid v. Amber Supreme Court decision explicitly endorsed this type of zoning. In his opinion for the 6-3 majority, Justice George Sutherland described an apartment building as “a mere parasite,” that would simply “take advantage of the open spaces and attractive surroundings created by the residential character of a neighborhood.”

Euclid remains the decision governing zoning laws today, and the Supreme Court has never heard a case that could overturn it. In addition to exclusionary zoning, cities also used what Rabin termed “expulsive zoning.” Those laws rezoned parts of predominantly Black neighborhoods to allow industrial and commercial uses, with the aim of undermining the livability of those areas. In a 1989 book, Expulsive Zoning: The Inequitable Legacy of Euclid, Rabin cited 55 examples of expulsive zoning around the country.

California Acts to End Exclusionary Zoning

According to the UC Berkeley Othering and Belonging Institute study, areas zoned for single-family homes are “whiter and wealthier” than mixed-housing zones, that is, zones where both apartments and single-family homes are permitted. The study found that in Southern California, four of every five neighborhoods were zoned for single-family homes. 

Up north, in a 2020 study, the institute found that in the San Francisco Bay Area, 85 percent of all residential land was zoned for single-family homes. 

In 2021, the legislature passed and Gov. Gavin Newsom signed SB 9, which effectively ended single-family zoning in the state. Sort of.

By restricting the supply of housing, single-family zoning drives up the price and, obviously, allows for fewer housing units to be constructed. The result—a housing shortage. That’s exactly what has happened in California. But some states are at least trying to change that, and California is the latest.

In 2021, the legislature passed and Gov. Gavin Newsom signed SB 9, which effectively ended single-family zoning in the state. Sort of. The law allows owners of single-family homes to build a second housing unit on their property, or even three more under certain conditions. That’s called “upzoning,” which means permitting more units to be built on a plot of land than allowed by current zoning laws. The opposite is “downzoning” which means allowing fewer units than normally permitted. 

But has SB 9 helped to alleviate the housing shortage? 

According to a 2023 study by the UC Berkeley's Terner Center for Housing Innovation, the answer is no. In a survey of 13 cities one year after SB 9 took effect, new housing construction using the law has been “limited or nonexistent.” The cities included in the study were Anaheim, Bakersfield, Berkeley, Burbank, Danville, Long Beach, Los Angeles, Sacramento, San Diego, San Francisco, San Jose, Santa Maria and Saratoga.

The Berkeley researchers found that in those cities, by the end of November 2022 only 282 applications for SB 9 housing units had been submitted, and the cities had green-lighted just 52—38 of those, almost three of every four, in Los Angeles.

The Future of SB 9

What’s going on? According to a report by RAND Corporation Economist Jason M. Ward, the problem is that the law contains two significant restrictions. First, SB 9 requires that any property owner looking to build on a single-family lot must commit to living there for at least three years after the SB 9 project is approved. Second, one person who owns two adjacent lots cannot apply to build additional units on both lots. 

The stated idea behind the restrictions, which were added late in the bill’s legislative process, was to shut out “institutional investors.” But as Ward points out, the three-year restriction also makes it difficult for homeowners to build on their own property, because they must commit to living on a construction site. Either that, or they’re forced to find alternative housing at their own expense while also maintaining their home on the lot.

So will the effects of single-family zoning—the de facto segregation, the shortage of housing— ever be alleviated in California? When SB 9 was proposed it was vociferously opposed by homeowner’s groups, local elected officials, and the California Republican Party. The group Livable California called SB 9 a “luxury housing bill that destroys your neighborhood.” 

Coalitions of local officials have been trying to repeal the law ever since it took effect. A petition drive by the anti-SB 9 group Our Neighborhood Voices fell short of the signatures needed to get the repeal measure on the November 2022 ballot. But they say they plan to continue the effort in hopes of making the 2024 ballot.