California’s housing affordability crisis has prompted numerous legislative solutions, but few have generated the practical impact of SB9, the state’s lot splitting law. While auxiliary dwelling units (ADUs) gained widespread acceptance, lot splitting has remained a more complex tool that many property owners and even municipal officials struggle to understand. Early adopters are discovering significant value opportunities through strategic property division.
Riechers Engineering has emerged as California’s primary specialist in SB9 lot splitting, with nearly 200 projects since the law’s implementation, over 60 finalized parcel maps, and more than $40 million in new property value unlocked for California owners over the past three and a half years.
“We see, on average, about a 30% increase in property value by an SB9 lot split,” explains Joe Snyder, who recently joined Riechers Engineering to lead sales and client engagement. “That sort of unlocking of additional equity and additional options provides strong value propositions for homeowners, whether they’re looking to develop, add equity to their real estate portfolio, or handle estate planning events.”
Unlike ADUs, which gained quick acceptance, lot splitting faced major educational hurdles. Gloria Riechers, COO of Riechers Engineering, notes that the firm initially had to educate not just property owners but also municipal officials about the law’s implementation.
“We are literally sitting down with municipalities, and they do want more housing. Almost all municipalities legitimately want additional housing and additional units, but they don’t know what they don’t know sometimes when it comes to these laws,” Snyder observes. “We have to sit with the municipalities in a very high touch, hand holding educational way, and walk them through the process as it’s supposed to be.”
This investment is beginning to pay dividends. Snyder reports receiving daily calls from property owners who have discovered Riechers Engineering through county records. “She was at the Santa Clara County Office trying to understand what her options were, and when she was at the county, she couldn’t get a straight answer. She saw the only name associated with SB9 in Santa Clara County was Riechers Engineering,” he recounts.
Riechers Engineering works across a broad spectrum of property values, with particular activity in higher-end markets.
“Anything where a property is valued 4 million to 6 million or above, that sort of value proposition is almost always a balance sheet conversation,” Snyder explains. “Doing a lot split on a property that’s currently worth $6 million and you’re unlocking a one and a half or two and a half million dollar new empty parcel is a balance sheet play for those types of individuals.”
The sweet spot appears to be around the $1 million property value mark. Below $500,000 to $600,000, the economics become challenging as the cost and expense of the SB9 process may not justify the value created.
Applications for lot splitting vary based on owner goals. About 80% of Riechers Engineering’s clients pursue lot splitting for value creation and investment rather than family housing needs.
“We have several clients doing mother-in-law quarters on a dedicated parcel with estate planning in mind, or child additional living quarters with estate planning in mind,” Snyder notes. “But most of what we’re looking at is people trying to unlock monetary value by selling that lot or adding rentals or a sellable flip property post development.”
The firm has developed partnerships with modular home builders, ADU-specific architects, and development partners to provide comprehensive solutions for clients. One compelling use case involves property owners seeking alternatives to downsizing. “We’ve got an amazing gentleman in Berkeley, a professor at Berkeley for years, who just wants to unlock that value while him and his wife continue to live on their beautiful property,” Snyder describes. This approach allows homeowners to access equity without relocating.
While SB9 continues to gain traction, the broader legislative environment presents mixed signals. SB 677, which would have expanded eligibility for lot splitting, stalled earlier this year. “We were having really high hopes that it would pass in November of this year to make way more properties eligible,” Snyder notes. “It kind of died in legislature a couple months ago.”
However, SB 450, passed in January, provides some incremental advantages, though Riechers acknowledges they haven’t noticed dramatic changes yet. The firm monitors legislative developments while expanding current opportunities.
“SB 677 coming out of the working processes and becoming a law would be a phenomenal shift for us, but it looks like that’s going to be pushed to 2026,” Snyder explains. “We’ll be looking at that closer next year.”
The education and awareness challenges that initially slowed lot splitting adoption are gradually resolving. Property owners increasingly understand the tool’s potential, and municipal officials are becoming more familiar with process requirements.
“The more projects we get to do in different jurisdictions, the easier it becomes,” Snyder observes. “We know more about what it costs and the jurisdictions are starting to get more used to SB9. I’m really looking forward to doing more projects and hopefully getting easier and easier as time goes on.”
This growing familiarity creates a positive feedback loop. As more projects complete successfully, both property owners and municipal officials gain confidence, reducing friction for future applications.
As California’s primary SB9 specialist, Riechers Engineering occupies a unique market position. “We are essentially the only SB9 specialty firm in the state,” Snyder notes. “That’s really kept us quite busy.”
The firm’s growth strategy focuses on maintaining high service levels while expanding their client base. “Looking into Q3, Q4 of this year, we want to stably grow and serve more clients, and we want to really give our clients and our partners that concierge level of engagement and service while we unlock the next $50 to $100 million in California property values.”
The success of strategic lot splitting demonstrates how targeted legislative solutions can create meaningful housing opportunities while providing property owners with new value creation tools. Lot splitting works within existing neighborhood contexts to increase density incrementally.
For California’s housing market, this represents a pragmatic approach to addressing affordability challenges. By enabling property owners to unlock equity through strategic division, lot splitting creates financial incentives for housing creation while respecting neighborhood character and existing infrastructure.
Looking ahead, the firm’s trajectory suggests growing market acceptance of lot splitting as a viable housing and investment strategy. With nearly 200 projects completed and millions in property value unlocked, the proof of concept is established. The challenge now lies in scaling these successes across California’s diverse markets and property types while maintaining the high-touch service that has driven their early success.
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