What is a variance in real estate? How to apply for one?

If you’re a homeowner or real estate investor with big plans for your property, you might need a variance to make it happen. But, what is a variance in real estate? Let’s break down what variance is, the types of variances, and some tips to make the application process a breeze.

You may ask: why do I need variance? We understand that zoning determines the types of buildings that can be constructed in specific areas. Local governments use zoning laws to ensure appropriate land use. They help prevent things such as a manufacturing plant next to a school or a shopping mall in a historic district. But what if you need to do something with your property that doesn’t fit the zoning rules? That’s where a zoning variance comes in. 

What is a variance in real estate?

A variance is a waiver that lets a property owner deviate from local zoning laws without changing them. It allows adjustments to land use in unique situations that wouldn’t normally be permitted. Basically, it’s an exception to traditional zoning laws, requested on a case-by-case basis, and can apply to physical property as well as planned developments. 

A point to note is that variances stay with the land they are applied to. They do not expire. For example, if a homeowner gets a variance to build a larger outdoor shed than allowed, the next owner retains this exception. Even if they change the shed or build something else. 

A property owner asks for a variance to use their property differently from what local zoning laws usually allow.

For instance, if zoning regulations conflict with your plans for your property, you can apply for a variance or special permit from your municipality’s zoning authority. Unlike zoning law, variances apply only to specific requests. For instance, homeowners might also seek variances to install taller fences or convert their homes into small businesses, bypassing local residential zoning laws.

How does variance work despite zoning laws?

To answer this question you need to understand what zoning laws are. These laws, established by local governments, dictate how properties can be used in specific areas. Zoning regulations require that a property matches the designated classification for its area, known as a zone. The idea is to protect the structure, development, and integrity of real estate within a jurisdiction.

Common zoning classifications include residential (single-family and multifamily homes), commercial, industrial, agricultural, and hospitality.

While zoning laws aim to benefit communities, they are often criticized for restricting private property rights. A zoning variance is an exception to these laws, granted by the local government on a case-by-case basis. There are various situations where a zoning variance might be needed. This includes modifying a single-family home to become a duplex or a multi-family home, changing the use of a building (like converting a house into an office), building a new structure on vacant land, or reclassifying a land parcel from low-density residential to high-density residential before selling it. 

Variances happen when a property owner shows that existing zoning rules hinder their property’s use. Each municipality has its own process for requesting and approving variances. The zoning board reviews the application. It notifies affected nearby property owners and sometimes holds a city council hearing to make a final decision.

Read more: NAICS code for real estate investment

What are the different types of variances in real estate, with examples? 

There are two types of variances homeowners and investors can request. Understanding both will help you determine which one you may need for your property or investment goals. Keep in mind that an area variance is easier to obtain than a use variance.

Area variance

This is the most common type of zoning appeal, typically requested by homeowners. It allows physical changes to a property that zoning requirements usually prohibit. For example:

• Building a fence where fences are not normally allowed or setting up a larger-than-average fence.
• Building a structure closer to the roadway than is permitted.
• Constructing a larger or higher building than zoning ordinances typically allow.

Use variance

This variance is requested mainly by real estate investors and developers. It permits using a property in a way that zoning laws usually don’t allow. For example:

• Converting a home into a small home office or storefront.
• Turning a single-family home into a multi family home.
• Building an industrial structure in an area zoned for commercial or residential use.

How can you apply for a real estate variance?

The process for applying for a zoning variance varies by county or municipality. Generally, you’ll need to pay a fee, complete documentation, and go through a community comment period.

The government might also require additional studies, such as property line surveys, traffic studies, or environmental impact assessments. Due to its complexity, working with a real estate attorney can be helpful. They can assist with paperwork and represent you in hearings.

Here are the general steps to obtain a variance:

• Fill out and complete a variance application from your local zoning board.
• Write a variance letter explaining why you need the variance. You need to detail the specific zoning law, the reason for your variance request, how the current zoning is causing you hardship, and how the variance won’t harm public interests.
• Wait for a decision from the zoning board to review your application. If approved, you’ll receive a variance permit.
• If denied, you can appeal. The appeal process typically involves a public hearing where you and community members can voice concerns or support. The council or commission then votes on your appeal. If denied again, there may be a waiting period before reapplying.

Are there any tips to get a zoning variance seamlessly?

To boost your likelihood of obtaining a zoning variance, thoroughly review your application. Ensure it complies with all requirements. Consult your general contractor to validate the feasibility of your project plan, communicate your intentions with your neighbors, and attend zoning board meetings to familiarize yourself with the process. And consult an attorney for guidance. These steps can help streamline the variance authorization process and increase your chances of success.

Key takeaway

Zoning is a contentious topic. Supporters argue it protects property values and neighborhood character, while opponents say it can be biased and hinder progress. For instance, single-family zoning may lead to housing shortages. 

If zoning laws prevent you from using your property as you wish, you can apply for a variance to get an exception. Zoning variances are rare exceptions. They’re typically granted only if they won’t harm property values, neighboring properties, or public interests.

Read more: What is syndication in real estate

Written by Ramona Sinha. May 30, 2024

Ramona is the Senior Content Writer for Kukun. This experienced blogger uses simple and succinct words to decipher the complex phenomenon called life. She has written articles covering a broad range of topics, such as real estate, lending and mortgage, finance, business, taxation, home designs, home improvement projects, decor concepts, and more. An avid traveler, she’s a digital nomad at heart and an animal lover from the depth of her soul.