Contents
What Is Zoning?
Why Is Zoning Necessary?
The Complexity of Zoning Data
Zoning Data’s Impact
Who Uses Zoning Data?
Where Can You Get Zoning Data?
Frequently Asked Questions (FAQs)
Zoning is a way for local governments to control land use. Control is vital so that governments can plan for growth, ensure sufficient infrastructure for urban populations, and protect the environment.
Local governments manage development through the creation of zoning ordinances that lay out the rules and regulations for land use. However, there is no one-size-fits-all when it comes to creating zoning ordinances to determine what can be built where. Surprisingly, there are no standardized zoning standards at the national level, which adds layers of complexity to zoning analysis and risk assessment.
Here’s a look at how proptech and data providers bring clarity to those who use zoning data for their investing and planning decisions.
What Is Zoning?
Towns and cities are built based on zoning. Local city and county government departments must make decisions such as whether a factory can be built next to a school, or whether a business can be located near residential housing.
These government entities create zoning ordinances that divide land into districts that are allotted to various land uses – residential, commercial, industrial, or mixed-use. Zoning ordinances also enforce rules on building size and density.
Zoning is largely based on government plans for future growth in an area. The plans dictate the blueprints for zoning assignments.
Why Is Zoning Necessary?
Zoning protects public health, safety, and a community’s welfare. If a company is allowed to build a factory near high-end housing, those houses prices will rapidly drop. If a developer wants to build a large housing estate, the location must be zoned as residential so that there is sufficient infrastructure, such as sidewalks for pedestrians and sufficient roadways.
Zoning and land use controls help to manage population density, for example, by limiting the amount of housing available in a location. This can help to avoid overloading existing infrastructure. Zoning rules also protect the local environment that might include valuable wetlands and floodplains.
That’s the 20-thousand-foot view, but zeroing in, zoning ordinances affect more granular decisions. A business owner relies on zoning rules to find out whether they can open a brick-and-mortar location in a neighborhood. A semi-urban homeowner might want to know the zoning rules for raising chickens in their backyard.
Zoning ordinances lay out a broad range of stipulations in addition to land use. These include building densities and building standards.
The Complexity of Zoning Data
There are more than 30,000 local zoning jurisdictions in the United States, and they all have their own sets of codes, definitions, and mapping standards. Unfortunately, there is no national zoning standard.
Property and zoning data are also layered, which makes them extremely complex. For example, a single parcel of land can be subject to multiple zoning labels—it could be within a historic district, a flood zone, subject to environmental protection, and so on. All of these layers together determine what can be built where.
Zoning Data’s Impact
Zoning rules’s sphere of influence is broad. They include an impact on home values, housing shortages, and community development.
- Home values: If a high-end residential area is guaranteed not to be “spoiled” by undesirable commercial activity, those homes will be valued accordingly. Research suggests zoning restrictions can increase housing costs by 20% to 50% or more in high-demand markets.
- Housing shortages: Stricter zoning rules can hamper housing development and create housing shortages.
- Land values for manufacturing: A 2023 academic study on upzoning effects in New York City shows that allowing more buildable capacity raises the “option value” of redevelopment, which increases property values. Manufacturing lots expected to be rezoned sold at an average premium of about 50% per square foot.
In some cases, older properties may become mismatched with the current zoning, maps can become outdated, and developers can face thousands of dollars in compliance costs when mistakes occur.
Who Uses Zoning Data?
Property owners, investors, real estate developers, buyers and contractors use zoning data to determine the potential of land and property for development reasons. If they intend to change a property, or open a business, they need zoning data to find out if the zone is zoned for commercial activities and if their plans are legally compliant.
Where Can You Get Zoning Data?
Zoning data are often in the form of PDFs, scanned maps, and fragmented municipal systems because there is no national data system. This makes zoning data complex and difficult to analyze at scale.
Zoning ordinances can be found on local municipal websites or by contacting local borough or township offices.
However, many users of zoning data get their information from proptech and data companies like ATTOM, who use artificial intelligence (AI) and geospatial analytics to standardize zoning classifications and link them to parcel-level property data.
ATTOM does the legwork so that investors, developers, and other users can conduct rapid risk assessments and feasibility analyses.
Get all your zoning and property information from one reliable source, ATTOM.
FAQ
- What is zoning and why do local governments enforce it?
Zoning is a way to manage land use. Controlling the development of land is necessary to protect communities and the environment. Urban and rural planning relies on zoning ordinances.
- Why is zoning data considered complex?
Zoning data are complex because any parcel of land can fall under any number of categories. A property might be in a historical area, a flood zone, or an area that is protected environmentally. Also, there is no one national standard for zoning rules. There are more than 30,000 local zoning jurisdictions in the United States, which makes analysis difficult.
- How does zoning affect property values and development?
Zoning directly influences property values and development opportunities. For example, restrictions can increase home prices by limiting supply, while rezoning changes, such as upzoning, can raise land values by allowing greater development potential.
- Who typically uses zoning data and for what purposes?
Zoning data are used by governments, property owners, investors, developers, contractors, and homebuyers, and more. These entities use the data for development planning, to determine how land or property can be used, ensure legal compliance, and evaluate development or business opportunities.
- How do proptech companies help simplify zoning data?
Proptech companies like ATTOM use artificial intelligence and geospatial analytics to standardize zoning classifications at the parcel level. Smart solutions help users quickly analyze zoning regulations, assess risks, and make more informed investment and development decisions.
