Definition
Zoning is the municipal regulation that divides territory into use zones (single-family residential, multi-unit residential, commercial, industrial, agricultural) and establishes rules applicable to each zone (density, height, setbacks, parking).
Mortgage financing impact: - A building whose current use is 'non-conforming' (prior use predating zoning regulations) can be financed, but with restrictions. If the building is destroyed, it cannot be rebuilt according to its former use. - A business or restaurant in a residential-only zone with a variance is risky for a lender — value is tied to the variance which may expire. - Properties in agricultural zones (green belt) generally cannot be financed as residential properties.
**Zoning change**: a property can see its value increase significantly if zoning is modified to allow more intensive use (e.g., conversion of a residential sector to mixed residential-commercial zone).
Verification: the survey certificate and title search include notes on zoning compliance.