According to recent data, it takes around 4-6 months on average to get a building permit for a single-family home in Los Angeles. And 6-12+ months for a commercial building permit (which includes multi-family residential properties of more than four units).
But why do building permits take so long? How does the process affect your real estate investments? And what can be done to move the process along?
Why Building Permits Take So Long?
Building permits generally take some time because:
- Compliance is a matter of public safety. Permits exist to prevent unsafe construction. Reviewers in the permitting office are thorough and cautious to minimize liability.
- The plans must meet zoning, land-use, and building codes. Before construction is even considered, the project has to comply with zoning laws (setbacks, height limits, lot coverage, parking requirements, and permitted use). Then the structural plans must meet building, fire, electrical, plumbing, and energy codes. All of this review work takes time.
- Multiple departments are involved. Permits aren’t handled by a single reviewer. Specialists in planning, engineering, fire, environmental, and utilities may all need to sign off. In many cases, these approvals need to happen sequentially rather than simultaneously because one department's approval depends on another department having approved its components.
- Environmental reviews. Projects may require stormwater plans, soil reports, floodplain analysis, or environmental impact checks. These may require additional agencies or outside consultants.
- Backlogs and staffing limits. A permit office may have more applications than staff can process quickly. This is especially true during periods of heavy construction. In Los Angeles, for example, we’re seeing longer backlogs because property owners are starting to rebuild after the 2025 wildfires.
- Incomplete, unclear, or problematic plans. If the reviewers don’t have enough information to sign off on the project (or find problems with your plans), they have to contact you for revisions. This can put your application on pause while you revise and resubmit the plans.
How Do Permitting Timelines Affect Your Real Estate Investments?
The permitting process can affect your real estate investments for better or worse.
Delays in permit approval could lead to:
- Higher carrying costs. Delays mean more months paying interest, taxes, and insurance. This also means you need more cash to keep the deal alive.
- Lower annual returns. The longer the timeline, the weaker your return on investment, even if profit stays the same.
- Market risk increases. While waiting for the permits, you’re exposed to rate changes, price shifts, and demand swings.
- Overly “safe” deal selection. Investors who are intimidated by the permitting process tend to favor simpler turn-key projects to avoid permit-related risk. This can create missed opportunities for more lucrative investments.
On the other hand, if you know how to navigate the permit process (or team up with real estate investment sponsors who have experience with the local permit office), you gain a competitive advantage over other investors.
How to Move Through the Permit Process as Quickly as Possible
You might not have complete control over the permit process, but there are things you can do to speed it along and reduce delay risks:
- Provide complete, clear, and compliant plans. The less back-and-forth required, the better!
- Choose projects with streamlined permitting. As an example, ADUs (accessory dwelling units) in Los Angeles can be permitted in around 8-16 weeks. You don’t have to limit yourself to only easily permitted projects, but making progress on a simpler deal like this while waiting for permits on a more sophisticated project may offer the right balance.
- Use local architects, designers, and contractors. Every jurisdiction has different regulations, so it’s important to hire professionals who have experience in the area where the project is located.
- Respond to any questions promptly, completely, and accurately. If a reviewer does need more information from you, responding quickly with everything they need allows them to get back to work on your file.
- Outsource the construction phase to a local sponsor. You don’t have to be a real estate developer to earn the benefits of investing in opportunistic ground-up construction. You can join other investors in pre-vetted development deals or invest in built-for-you developments for sole ownership of the completed property. Either way, the sponsor handles the permitting, so you don’t have to.
Leverage Gatsby’s Decade of Experience with LA Permitting
Los Angeles has long been a best-kept secret in real estate investing. And Gatsby Investment has been helping investors access deals with high return potential in this high-value market for 10 years!
Gatsby is an LA-based sponsor that specializes in real estate syndication projects. We find and analyze deals, secure permits, oversee construction, and manage lease-up and stabilization until the completed property is ready for resale. We’ve successfully acquired over 100 properties in the LA area and have worked extensively with the local permit office to secure permits quickly and efficiently.
Whether you’re looking to join in a syndicated real estate deal or outsource the construction of your home or investment property to the professionals through a built-for-you service, Gatsby Investment is here to help!