I have to wonder if some of the more affluent neighborhoods/cities won't just find a way to stop this in their area. Does anyone have a sense of how effective this law will really be, particularly in cities with NIMBY attitudes?
I don't really see it affecting say Atherton or Los Altos Hills much - the people who live there are rich enough that splitting a lot and putting up duplexes isn't going to make a measurable economic difference to them, at least not one worth giving up their prime estate. The hillside communities (mid-peninsula, Oakland/Berkeley hills, Saratoga/Portola/Woodside) likely also won't see much adoption, just because the geology & topography doesn't really support the types of construction & road access to build multi-family housing.
I could see it making a huge difference in "affluent suburbia" - places like Sunnyvale, Cupertino, San Jose, the SFH parts of Mountain View and San Francisco, etc. The lots there are generally wide enough to support a lot split, and you have a lot of homeowners that just spent $3M because you need to in order to own property, carrying a massive mortgage. The lot split would immediately let them pay back a good chunk of that principal, and a duplex would give you rental income to cover most of the payment. A lot of homeowners would go from being financially stretched on 2 FAANG incomes to being comfortably able to live on one salary, while still maintaining ownership of a duplex.
Many of these neighborhoods are precisely the ones that need it most - they're close to jobs, they're flat, they could support a lot more population, and they already have significant pro-housing contingents. Traffic on 85 is going to suck even more than it already does, though.
It might be a popular action for people to take just before they move out. Instead of selling one house for $3M, build the duplices, sell them for a combined $5-6M, and leave instead of living with the consequences.
That might happen in the really rich neighborhoods too.
I half-joked on Reddit that folks in Atherton or Palo Alto might do it just to troll their neighbors. Not every rich person likes every other rich person; if you've had a rocky relationship, what better way to get even than to make your uptight neighbors live next to a bunch of ordinary people?
You'd have way better liquidity too. It's hard to sell a $15M estate. It's significantly easier to sell a pair of nice duplexes, each on 1/2-acre lots with double ADUs on each. You could probably get more than $15M in total for them too, since 8 units with an Atherton zip would rent for a pretty penny.
Pretty much any suburban development of single family homes will include a restrictive coveant on each property that it may only be used for a single family dwelling.
Lots of older neighborhoods in cities, however, don't have any such covenants.
