Advertiser Disclosure

advertising disclaimer
Skip to main content
construction plan approval

What Is a Variance in Real Estate? An Investor's Guide

Here's what you need to know about real estate variances.


[Updated: Feb 04, 2021] Sep 27, 2020 by Tara Mastroeni
Get our 43-Page Guide to Real Estate Investing Today!

Real estate has long been the go-to investment for those looking to build long-term wealth for generations. Let us help you navigate this asset class by signing up for our comprehensive real estate investing guide.

*By submitting your email you consent to us keeping you informed about updates to our website and about other products and services that we think might interest you. You can unsubscribe at any time. Please read our Privacy Statement and Terms & Conditions.

In real estate, a variance is an exception to your local zoning laws. If you're a homeowner or investor looking to do something prohibited by local zoning restrictions, you'll need a variance to make your property work for you.

This guide to how variances work in the real estate industry will discuss what variances are, how they work, and what you need to do to obtain one for your property.

What is a variance in real estate?

In real estate, a variance is an exception to the local zoning law. However, getting a variance doesn't change the current zoning requirements for the area, nor is it the same as rezoning the property. Rather, it acts as a waiver to a zoning regulation, granted on a case-by-case basis for specific requests.

Once a zoning variance has been granted, it runs with the land, which means it's attached to the property rather than its owner. In essence, it means that, if a requested variance is granted, it will stay in place, even if the property changes hands.

Keep in mind zoning laws or ordinances are usually determined on a local level rather than a state or federal one. To find out about the existing zoning laws and restrictions for the area where your property is located, you'll need to get in touch with your local zoning board. They'll be able to tell you more about the zoning codes for the area and what types of variance requests are typically granted.

What are the different types of variances?

Before getting into specifics of how to obtain a variance, it's important to understand the different types of variances. We've explained each of them below, as well as a few examples. Armed with this knowledge, you should be able to clearly understand which type of variance you need for your property

Area variance

The most common type of zoning appeals, area variances refer to a request to use the land in such a way typically not allowed by the dimensional or physical allowances of the applicable zoning requirement. While that definition may sound complicated, it essentially means you want to change a physical aspect of the property rather than the way the property is used.

Some examples of area variances might include:

  • A request to put a fence up along your property line.
  • A request to build a property closer than normally permitted to a roadway.
  • A request to build a structure higher than usually permitted by the local zoning ordinance.

Use variance

As you might be able to guess from the name, a use variance refers to a request to change the way in which the land is to be used, according to the existing zoning requirements. While homeowners are more likely to request area variances, investors are most likely to use this type of variance.

That said, since the way a property is used is likely to have an effect on the surrounding area as a whole, use variances are often harder to obtain than area variances, and they usually require special circumstances or a much higher burden of proof for the applicant.

Some examples of use variances include:

  • A request to turn a single-family home into a multifamily property.
  • A request to open up a commercial business in a residential property.
  • A request to put an industrial building in an area zoned for commercial use.

How to get a variance

Again, since variances are determined on a local level, it's hard to get into specifics about the exact variance process you'll need to follow to obtain a variance in your area. However, in general, you'll take these steps.

Fill out an application

Typically, the first step in receiving a variance is to fill out an application and pay a fee. Variance applications are typically more rigorous than just explaining what you'd like to do to the property. As the landowner, if you want a variance, it's up to you to provide the burden of proof for why the variance is necessary.

In order to be approved for a variance, landowners need to prove the following:

  1. That adhering to the existing zoning requirements will cause you unnecessary hardship.
  2. That the particular hardship is due to limitations unique to your property.
  3. That, if granted, the variance will not harm public interests.

Usually, all three criteria must be satisfied for the variance to be approved.

Await a decision

Once you've turned in an application and paid any necessary fees, the next step is to await a decision from your local zoning board on the issue. Typically, their ruling is based on a strict reading of local zoning laws.

if your variance request has been accepted, you'll receive a permit. If not, you'll generally be given the opportunity to appeal the decision.

The appeal process

Typically, the appeal process takes the form of a public hearing on the zoning issue. Sometimes, the zoning board informs nearby property owners of your requested variance, and they may come to the public hearing to state their case on how they believe granting the variance will affect public interest.

During the hearing, it's also up to you as the petitioner to make clear the special circumstances and unnecessary hardship that will be caused if the variance isn't granted.

For an area variance, the property owner usually must prove existing zoning restrictions prohibit them from fairly using their own property. For a use variance, on the other hand, the burden of proof is higher. In this case, it's common to be asked to prove that without the variance, you won't have a viable use for your property.

The bottom line

While obtaining variances in real estate may not be the most exciting part of investing or owning a home, when they're needed, they are essential. If you need a variance for your property, use this as a guide to the process.

That said, since every municipality has its own zoning code, if you're looking for more specific advice on what to do, your best bet is to either talk to someone in your local zoning office or consult a real estate attorney.

11% of the mega-wealthy swear by this investment…

The richest in the world have made their fortunes in many ways, but there is one common thread for many of them: They made real estate a core part of their investment strategy. Of all the ways the ultra-rich made their fortunes, real estate outpaced every other method 3 to 1.

If you, too, want to invest like the wealthiest in the world, we have a complete guide on what you need to take your first steps. Take the first step toward building real wealth by getting your free copy today. Simply click here to receive your free guide.

Bank CD rates has a disclosure policy.