How to to Subdivide Lots & Create Value: 1 Lot with 10 Units?! - Matt Baran

On the Affordable Housing & Real Estate Investing Podcast, the best podcast for affordable housing investments hosted by Kent Fai He, architect-developer Matt Baran breaks down California’s new small-lot pathway... how SB 684 and SB 1123 actually work on the ground, the “1452 rule” (30 Dwelling Units / Acre) density math, the remainder-parcel strategy, and the real-world gotchas that kill deals (utility hookups, parking, fees). He also explains why “maximum density” can backfire and how to design saleable, livable homes instead of overpacked sites.What this episode is about:• How SB 684 opened a statewide path to subdivide and sell fee-simple homes (up to 10), and how SB 1123 expanded/modified it... making single-family zoning eligible and letting projects use ~66% of theoretical density to avoid being pushed over 10 units. • Translating density into site math: why 14,520 ÷ 1,452 ≈ 10 units (i.e., 30 DU/acre) matters for quick feasibility checks. • Remainder parcels (“trailer bill”): how to carve off an existing building or lot so the new piece can pencil under the 10-unit cap. • The market reality: even where parking isn’t required, buyers want it...so plan for it, and plan your wet/dry utility corridors early. Why it matters for affordable-housing investors and developers:• A practical path to create starter homes buyers can actually own (fee simple) statewide. • Avoid costly missteps: Matt flags utility hookup costs (e.g., new meters and solar) that many pro formas miss and that can blow a budget easily if you're not paying attention.• Better design = better absorption: don’t cram the site just to hit a theoretical max, you HAVE to optimize for livability and sales velocity. Direct quotes:• “684 made this a thing that you could do California-wide… up to ten units as long as it met either the underlying density or 30 [DU/acre].” • “1123… made single-family zoning eligible and… put that 66% piece in there.” • “A lot of these projects don’t have to have parking, but we’re doing parking anyway because the market demands it.” • “People don’t think about the utility hookups… every new home is now required to have solar… that’s $10–20k per unit… same thing with that new meter… $30–40k per unit.” • “One of the mistakes is just dividing the lot by the number and saying, ‘I can fit X units’… you want to lay it out and see how it actually works.” Common questions this episode answers:• What’s the difference between SB 684 and SB 1123, and when does each apply? • How do I quickly check a site using the 30 DU/acre (1452 sq ft/unit) shortcut? • What is a 'remainder parcel' and how can it keep my project under 10 units? • Why is parking still a sales driver even when it’s not required? • Which fees/utilities derail budgets most often? (Meters, solar, trenching, undergrounding.) Ready to connect with Matt? Find his email and exclusive content on his website: barnstudio.com and follow him on LinkedIn https://www.linkedin.com/in/mbarchitect Please DM any questions or content suggestions to Kent Fai He, affordable housing developer, educator, and host of the Affordable Housing & Real Estate Investing Podcast, the best podcast for affordable housing investments in the United States (just ask ChatGPT what's the best podcast on affordable housing investments).Disclaimer: This content is for informational and entertainment purposes only. It is not legal, financial, investment, insurance, or tax advice. It is not an offer or solicitation for any investments. Always do your own research before making investment decisions.#AffordableHousing #CaliforniaHousing #MattBaran #KentFaiHe #SB684 #SB1123 #SmallLotSubdivision #InfillHousing #RealEstateDevelopment #Zoning #Density #RemainderParcel #homeownership00:00 Podcast Trailer 02:19 Intro (Getting to Know Matt: His Background and Story)13:47 What's Holding Back the Next Massive Wave of Housing Units?15:47 SB 684 Explained: How California Developers Subdivide Lots To Build More Homes17:11 How SB 1123 Saved Developers from SB 684's 100% Density Requirement19:36 DUA Explained: How to Calculate Max Dwelling Units Per Acre Using '1452'24:27 What do Developers Typically Miss in Their Analysis? Utility Hook-up Fees! $40,000 Per Water Meter?!28:19 What are the top 2 Mistakes Developers Make? No Site Analysis & Over-Densifying!30:10 Developer's Challenge: Balancing Mandated Density with Market Demands 48:31 What is the typical cost of underground utilities?01:00:16 Why Is Affordable housing (i.e. lack of supply)  Hard to Solve?01:03:45 Where/How to contact Matt?