Live/Work Changes Headed to Council March 12
Eric Richardson
[Flickr]
The Cornell Building, part of the Santee Village complex, is one of the projects that could benefit from changes to the city's definition of live/work units.
DOWNTOWN LOS ANGELES — A code change that could make Downtown condos easier to finance brought out numerous supporters to a meeting of the City Council's planning committee in January, but nearly two months later the item still has yet to be finalized. It will head to City Council on March 12 for adoption.
By altering the definition of live/work units to be primarily residential, backers hope to make Downtown units eligible for cheaper loans secured by the Federal Housing Administration.
Even then, though, the changes might not do as much as they once would have.
"Now it's taken so long that all the [Federal Housing Administration (FHA)] guidelines have changed," said Bill Cooper, President of the Downtown Real Estate Association. "It will definitely help us, but there are a lot of new things that are involved now."
The approval process started with the City Planning Commission in July, but the item's first trip to Council was halted in December after concerns were expressed that the new rules could make it harder for a developer to create space suitable for use as artists' studios.
A compromise was hammered out, and a new two-tiered live/work definition was proposed. The first tier would have under 25% commercial space, satisfying FHA requirements for its secured loans. The second would allow 25 - 50% commercial, and would be more suitable for artist uses. A developer would simply choose one definition or the other when applying for permits.
The City Attorney's office has prepared an ordinance based off that compromise, which will now go before Council.
The City Planning Commission said that it should get another shot at the item because the concept is now "substantially different" than the one it approved, but the Council's planning committee today sent the item forward instead.
Even with new rules, the prospect of the FHA insured loans is enticing. They require only 3.5% down, compared to 10-20% for uninsured loans. For a $300,000 condo, that's the difference between a $15,000 down payment, and one of $30,000 to $60,000.
Guest on March 05, 2010, at 03:10PM – #1
A slight correction, FHA requires 3.5% down min.
D
Guest on March 05, 2010, at 07:09PM – #2
Not to be a jerk, but if you don't have 10-20% for a down payment, you shouldn't be buying a house. That's a big part of the reason the economy is in the tank right now. Saving 10-20% for a down payment takes dedication and lets the bank know that you have a stake in the property. Why is it that $30,000-$60,000 seems an unfathomable amount to save for most people but owing a bank $300,000 is looked at so casually. On an actual post related note I am all for more development DTLA.
Eric Richardson (@blogdowntown) on March 05, 2010, at 07:13PM – #3
D: I think that changed (from 3 to 3.5%) over the time this item has been in process.