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Senate Bill 1123: A 2025 Guide for California Homeowners and ADU Builders

California’s housing laws continue to evolve as the state works to address long standing shortages in residential units and expand opportunities for infill housing development. With the introduction of senate bill 1123, commonly referred to as sb 1123, homeowners with vacant land now have a new option to create newly created parcels through a simplified approval pathway. This law, which builds on the groundwork established by sb 684 and the starter home revitalization act, aims to increase small lot housing developments in areas zoned for single family use while reducing delays and uncertainty in the review process.

As a design build firm specializing in accessory dwelling units, custom small homes, and residential development advising, Golden State ADUs is committed to guiding Northern California homeowners through changing regulations. Below, we break down how sb 1123 works, what types of housing development projects qualify, how the new ministerial process functions, and what it means for those considering an ADU, a proposed subdivision, or a proposed housing development project.

What Is SB 1123? A Quick Overview

Senate Bill 1123 is a California housing law that expands upon prior statutory provisions establish procedures for small lot subdivisions. Under existing law, many subdivision applications required lengthy discretionary review, environmental evaluation, or public hearings. sb 1123 changes that for a narrow but meaningful category of projects.

The law allows certain vacant lot zoned for single family residential use to be proposed to be subdivided through a ministerial review process, meaning the local agency evaluates the project using objective criteria only. There are no public hearings, no subjective design reviews, and no environmental assessments under the California Environmental Quality Act. This creates a faster, more predictable approach to creating parcels created for new housing units, especially in qualified urban areas or sites that are substantially surrounded by existing development.

The law becomes fully effective on July 1, 2025 and applies to housing development projects located in a legal parcel located within a qualified urban uses area as defined by statute. For homeowners, builders, and planners, the goal is to enable new small scale homes to be built in areas already suitable for housing development while respecting safety standards from the health and safety code, the national flood insurance program, the federal emergency management agency, and the california building standards law.

Key Provisions of SB 1123: Housing Development Focus

Applies to Vacant Single Family Zoned Lots

To qualify for sb 1123 streamlining, the property must meet several criteria. The lot must be vacant, meaning there is no existing dwelling unit or other existing dwelling unit in usable condition. The parcel must be zoned for single family, must fall within single family zones, and must be no more than 1.5 acres in size.

The minimum parcel size allowed for a subdivision under this law is 1200 square feet. Every individual parcel created must meet this threshold. The existing zoning designation and existing zoning designation applicable to the lot remain in place, and all new lots must conform to maximum allowable residential density or applicable residential density set by the jurisdiction. Still, the law allows more flexibility than traditional single family residential development rules would normally offer.

Ministerial Approval for Subdivisions

Under sb 1123, qualifying subdivisions are processed through ministerial review only. This is a major difference from discretionary review, which involves hearings and subjective decision making. Ministerial processing allows the local agency or the applicable local government to issue a decision quickly based on objective standards.

Once the application for a housing development project submitted under this program is complete, the local building department must determine approval within 60 days or the project may be deemed approved. This accelerates the timeline significantly compared to subdivisions processed under the subdivision map act.

Certain protections still apply. The property cannot be a hazardous waste site designated, cannot conflict with a habitat conservation plan pursuant, and cannot be located in areas that violate applicable federal qualifying criteria. Standards from state or federal agencies, including forestry and fire protection, still apply.

Density Rules and ADU Exclusion

A key component of sb 1123 is the density requirement. The subdivision must produce fewer residential units only if doing so still meets maximum allowable residential density or the density required by a jurisdiction’s housing element or an adopted housing element. If a property is proposed development for a housing development project constructed under the law, it must still respect any local inclusionary housing ordinances when applicable.

One of the most important clarifications for homeowners is that accessory dwelling units, accessory dwelling unit, junior accessory dwelling units, and junior accessory dwelling unit do not count toward the cap of units under this program. This opens opportunities for combined subdivision plus ADU strategies where primary homes plus ADUs can coexist within the same overall plan.

The law also acknowledges multifamily residential development, multifamily residential dwelling, and multifamily residential dwelling use, although the subdivision streamlining here is centered on single family residential lots.

Why SB 1123 Matters for California Homeowners

More Flexibility in Single Family Zones

For decades, single family zones limited most parcels to a single structure. With sb 1123, homeowners with qualifying vacant land now have flexibility to split property into multiple housing units. Even when producing fewer parcels than the maximum allowed, property owners can still achieve a more productive land use compared to traditional single family residential development.

Faster Path to Small Scale Development

Because statutory provisions noted in sb 1123 allow ministerial processing, homeowners can move quickly into design, permitting, and building. Subdivisions that previously took a year or longer can now be completed in a fraction of the time. This is an advantage to anyone exploring proposed housing units, lot splits, or new construction.

Better Return on Investment

The ability to create newly created parcels, add homes, and possibly permit accessory dwelling units on each lot enhances long term property value. A property once limited to a single home may now support multiple housing developments or ADUs. For family compounds, rental opportunities, or resale strategies, this new flexibility is a major benefit.

SB 1123 and ADUs: What You Should Know

You Can Still Build ADUs on Subdivided Lots

A significant part of this bill is how it interacts with accessory dwelling units. Since ADUs do not count toward the unit totals that apply to newly subdivided lots, a homeowner can subdivide a parcel, build a primary home, and still add an ADU. This is especially valuable for owners planning proposed development with multiple households in mind.

How This Impacts Your ADU Strategy

Traditionally, homeowners evaluated an ADU as the sole expansion option. With sb 1123, the possibilities expand. A property might be proposed to be subdivided into several lots, each supporting a primary home and possibly accessory dwelling units or a junior accessory dwelling unit. Golden State ADUs can help you evaluate whether building ADUs alone or combining subdivision plus construction offers the greatest payoff for your goals.

Who Is Eligible Under SB 1123?

Property Requirements Checklist

To qualify for sb 1123, the parcel must be:

• Vacant and zoned for single family
• Suitable for minimum parcel size requirements
• Located within a qualified urban or surrounded by qualified urban area
• Not located in a flood or fire hazard area unless allowances exist under the national flood insurance program or federal emergency management agency
• Free of hazardous waste site designated status

Location and Surrounding Context

The proposed site must be substantially surrounded by urban uses and must comply with existing zoning designation and local zoning. A local government or local agencies may have additional objective standards but cannot impose discretionary review.

Design and Permitting Under SB 1123

Objective Standards Only

The local agency must rely strictly on objective criteria. This includes height, setbacks, lot coverage, and compatibility with the health and safety code. Any housing development project consisting of new lots must still follow the tentative and final map process, though under ministerial rules.

Permit Timeline and Processing

Once a complete application is filed, the local agency must either approve or deny within 60 days. If not, the project may be deemed approved. This streamlining reflects the intent to reimburse local agencies efficiently for review costs while maintaining a state mandated local program.

Golden State ADUs Can Help You Navigate SB 1123

Full Service Guidance from Design to Construction

As a local design build firm, we understand the nuances of sb 1123 and how it intersects with ADUs, subdivisions, and small home planning. We guide homeowners through feasibility studies, conceptual layouts, ADU design, proposed site planning, submission to the local building department, and full construction.

Our team has experience working with unique ownership structures such as a community land trust, a limited equity housing cooperative, or a nonprofit corporation organized pursuant to state rules.

Why Work With a Local ADU and Small Home Expert

Northern California cities each interpret existing law slightly differently. We help ensure your project meets the above described specified conditions and aligns with the housing element of your jurisdiction for smoother approvals. Whether planning a single ADU or a complex subdivision with housing development project constructed on multiple lots, Golden State ADUs offers end to end support.

FAQs About SB 1123 California

Can I build an ADU and subdivide my lot under SB 1123?

Yes, you can build accessory dwelling units (ADUs) and junior accessory dwelling units (JADUs) on subdivided lots under SB 1123. These units do not count toward the maximum unit totals, providing more flexibility for your development plans.

Does my property qualify under SB 1123?

Qualification depends on several factors, including zoning, whether the lot is vacant, its location, and any applicable hazard designations. We can help evaluate your property to determine eligibility under the law.

Is SB 1123 the same as SB 9?

No, SB 1123 applies specifically to vacant parcels and allows streamlined subdivision, while SB 9 addresses development on already developed lots. They serve different purposes within California’s housing laws.

How long does ministerial approval take?

Ministerial approval under SB 1123 typically takes up to 60 days from when your application is deemed complete. This process is designed to be faster and more predictable than traditional discretionary reviews.

Do local inclusionary housing ordinances apply?

Local inclusionary housing ordinances may apply, but generally only to the primary residences created through the subdivision. ADUs and JADUs are usually exempt from these requirements.

Ready to Explore What SB 1123 Could Mean for Your Property

If you own a vacant lot or are considering redevelopment, sb 1123 may be the key to unlocking new value. Golden State ADUs offers consultation, feasibility review, and design build services to help you explore your options and create a plan that aligns with your goals and local regulations.

We are ready to help you build smarter, faster, and with confidence.