As in many professions, home builders face a number of challenges. One challenge in particular relates to the role that local governments and zoning boards play in getting new homes and communities approved and built. There are laws, fees, regulations and more that must be considered, and they’re different depending on a home builder’s market. We spoke with three of Epcon Communities’ regional presidents to learn more about local governments in their respective regions and their advice for alleviating zoning challenges for home builders.
How much of a role do local governments/zoning boards have in the increasing cost of housing?
Regulation at all levels has a tremendous adverse impact on the cost of housing. The National Association of Home Builders studied this and determined that regulation adds approximately $94,000 to the cost of a $400,000 new home. According to that same study, this is up $65,000 in regulatory costs from just 10 years ago.
-Joel Rhoades, Epcon Regional President, Columbus, OH
Our local municipal fees and taxes have remained fairly stable over the last few years. However, local governments and zoning boards absolutely impact housing costs with fees and regulation.
-Tom Sewitsky, Epcon Regional President, Raleigh, NC
They play a fairly significant role as they dictate the kinds of homes that can be built on each property they approve. This includes size, exterior materials, sometimes quantity of windows, landscaping requirements throughout a neighborhood, trails, etc. All of these items play into the cost of the home.
-Brooks Longfellow, Epcon Regional President, Indianapolis, IN
What are some ways you’ve discovered to help move projects faster to approval?
The approach we use is to actively manage the process and work hard on it every week. We don’t just delegate to our land planner, civil engineer, attorney or other consultants but remain involved throughout.
-Joel, Columbus, OH
With regard to planning approvals, we have regular meetings with our engineers and consultants prior to submittals to make sure every one is as complete as possible. We establish timelines for all approvals and track them weekly to identify any delays early in the process. With regard to zoning, we meet with any applicable parties quickly to help ease political concerns.
-Tom, Raleigh, NC
We work hard to gain buy-in from all parties involved. We meet with close-by neighbors to ensure they fully understand our project and do our best to overcome any objections they may have. We also meet with city council members individually to understand and address any of their concerns.
-Brooks, Indianapolis, IN
What are the typical impact fees and land use restrictions home builders encounter?
We frequently experience impact fees for schools, parks, open space, streets and emergency services. Land use restrictions primarily include zoning but get into more restrictive elements like material and color selections, setbacks, building separation, dimensional requirements, minimum home size, sidewalks, leisure paths, landscaping, and on and on.
-Joel, Columbus, OH
Fees – Parks and Recreation Fee, School Impact Fee, Water and Sewer Impact Fee, Traffic Impact Fee, Inspection Fees, Affordable Housing
Restrictions – Future Land Use (Density), lot size, Building Setbacks, Impervious Surface, Architectural, Stream and Wetland Buffers, Open Space, Parking Requirements, Champion Tree Preservation, Tree Buffers, Stormwater Retention, Endangered Species Protection, Community Interconnectivity and Right-of-Way Conveyance
-Tom, Raleigh, NC
The fees are going to vary depending on the municipality, and they are all listed on their respective websites. As far as restrictions, this depends on the current zoning and the zoning you are trying to achieve. As you work toward the zoning you want, the municipalities will control what they want on the property through density, architectural review, monotony control, etc.
-Brooks, Indianapolis, IN
How much time and what resources are typically needed to meet local environmental and zoning requirements?
We typically assume it will take two years to get a site identified, in contract, and through zoning, development plan, and civil engineering approvals. Some communities where we want to build can take even longer.
-Joel, Columbus, OH
Timing varies from municipality to municipality. To take a project through a full rezoning/entitlement process from contract to approved construction drawings for land development, it can take 24 to 36 months. Some resources include a zoning attorney, environmental consultants, geotechnical engineer, civil engineer, surveyor, traffic engineers, political consultant and general contractor.
-Tom, Raleigh, NC
We would likely spend 6 months to a year on any given project but this could easily extend.
-Brooks, Indianapolis, IN
What are some tips you employ to get municipalities to understand and get excited about developing communities and building homes in their markets for 55+ home buyers?
The best approach we have to encourage local governmental support is to appeal to a communities’ need for housing for the residents (and residents’ parents and grandparents) who have lived in a community but now want and need a different lifestyle than that offered by traditional homes. Epcon Communities’ right-sized, single-story homes with private amenities allow people to age in place and remain in their local community longer.
-Joel, Columbus, OH
We focus on all the tax benefits with less burden on schools, traffic and utility services.
-Tom, Raleigh, NC
We emphasize the benefits 55+ buyers bring to the municipality. They have no impact on schools and they have little impact on traffic. They have money to spend in the municipality and there is a growing number of them. We also emphasize the quality product they will purchase and the tax revenue that will be generated.
-Brooks, Indianapolis, IN
Anything else you’d like to add on land use and zoning?
Land use regulation has become so pervasive and intrusive that I believe it is one of the most significant limiting factors affecting our industry today. In Ohio, even when we are able to achieve satisfactory zoning approval from a local council or board, it is frequently subject to voter referendum which can quickly reverse the hard-fought victory. Epcon Communities is fortunate that we can cite our low impact, high home values and residents who are actively involved in the community.
-Joel, Columbus, OH
Epcon Franchising helps home builders solve the challenges they’re facing in their business so they can build smarter and scale faster when building for 55+ home buyers. Learn more about what we offer.
Government is just one challenge home builders face. Download the guide “10 Challenges Home Builders Face” to learn more about how to overcome each one.