Zoning is a term used to describe how local authorities designate certain areas for certain activities. For example, one part of town may be zoned for housing. If someone applied to build an industrial plant in the middle of that housing zone the authorities would likely refuse, because it would adversely affect those who live there.
Equally, if a developer wanted to build a block of housing in an area designated for heavy industry they would likely fail because the authorities would consider it inappropriate.
That said, sometimes the local authorities make an exception. This is known as a zoning variance.
Zoning variances are the exception, not the rule
Let’s say you are a property developer. You spot that one of the offices in the town has been redeveloped into residential apartments. You decide there is money to be made so search for other old office buildings on the same street that are available for a reasonable price. You figure you, too, could redevelop them into residential apartments.
Before you proceed, you need to check the zoning. Has the zoning of the area been changed to allow residential property? Or has the other developer just received a zoning exception?
A zoning exception is a one-off and just because they got one does not mean you will. You’d need to investigate what reasons they used to persuade the local authority to allow them to proceed. Maybe that building had a long history of residential usage and was only turned into an office recently. Perhaps they just got lucky. Or perhaps the decision to grant them the variance caused such a furor that there is no chance of any further exceptions being granted.
Due diligence before committing to a purchase can help you make the right decision as to whether or not to invest.