Showing results for 
Search instead for 
Do you mean 
Posts: 1
Registered: ‎11-18-2012

Lot is zoned partly as residential and partly as industrial

I am planning to buy a house that is built on a lot which is zoned partly as residential and partly as industrial.  Will this partial residential/industrial zoning affect its property value?  Are there any potential issues if I buy this house? Thank you for the advice.

Redfin Agent
Posts: 74
Registered: ‎06-10-2011

Re: Lot is zoned partly as residential and partly as industrial

What kind of property are you looking at? Condo, single family, or multi-family? Condo financing can be restricted when there is commercial space in the condo building. Over 20% of a condo building being occupied by a store or other venture can make it difficult for buyers to get a conventional loan, though private bank lenders are available . FHA recently increased the acceptable commercial space limit to to 35% of a condo building.


Regardless of property type, this question should be posed to your lender right away. Its the impact on lending that affects your future value more than anything else and more importantly may affect your ability to buy the property. Aside from the lending issue, you should consider the impact to value of abutting an industrial zone. Is there a noisy/dirty factory or car repair place nearby? Is this property one of the few residential properties on the street? Are large trucks pulling in and out all night? These things do affect value and should be baked in to whatever price you offer, though I would hope the listing agent took that into account when he/she set the list price.


After consulting the bank, consult a good real estate attorney. A real estate attorney can do a zoning analysis and provide more detail about the impact of zoning on the property. Sometimes there is a positive affect if it means that shopping is nearbythough that is more likely tobe so in a "commercial" zone "industrial" zone. Or it may be that industrial proeprty in your neighborhood is worth more than residential property and you are walking into an unexpected value situation the listing agent has failed to detect. In any event, It is possible also that being in a dual zone provides a flexibiulity of property use that may be beneficial to future owners -- think a master plumber that wants to run a shop out of his garage, etc. You are asking the right questions at the right time in the process to avoid problems and not everyone does this . . so GOOD JOB!