The CUTE house pictured is part of a “cottage cluster” in Asheville’s Montford neighborhood. There is a walkway down one side of the house to a rear cottage + carriage house. The house facing the street is owned by one household while the rear properties are owned by another household. This was creatively done by what is known as a flag lot ordinance.
Flag lots are defined as a piece of land that is shaped like a flag, with a narrow strip of land extending from the street to a larger lot behind it. Flag lots are also known as flagpole lots (thanks, Google AI).
The flag lot’s Carriage House is accessed via an apparent easement to allow for a car to drive down the side of the front Craftsman.
Flag lots can bring a bit of controversy and have been weighed for over two years here in Asheville. Many NIMBY groups AND folks worried about displacement think flag lots can create issues. NIMBY’s worry because they see smaller lots as detrimental to property values. Those worried about displacement (called legacy owners in Asheville) are more concerned about the changing culture of the area and that more housing will create more noise, cars, etc.
Should flag lots be seen and promoted as a creative tool to help promote common sense housing infill? I’m no NIMBY and think these flag lots open up opportunity for homeownership, using existing infrastructure making them more eco-friendly, and help homeowners unlock the potential of their backyards without having to go through the sometimes difficult financing process. More on financing to come.
View of the actual “flag pole” portion of the lot. This gives walkable access to the backyard portion of the lot. You can see a Cottage in the rear.
The best way to teach about flag lots in my mind is by example. The above Craftsman bungalow is one of my favorites along my morning walk — it just so happens to be the primary lot for the flag lot that was cut off from it.
You can see what the actual flag lot looks like with this Craftsman bungalow in Asheville (Buncombe County, NC) — the “flag pole” goes down the side of the lot, helping to give access to the rear portion of the lot to build another house.
The Craftsman with an earlier paint job. It was the “donor lot” to the flag lot. You can see the flag pole shape of the secondary lot.
Another view with the apparent driveway easement for parking. I’d wager a guess that the donating lot gave itself parking access in the rear on the lot it donated to.
Why do flag lots exist? Why should we consider flag lots as a way to develop housing?
Typically a property owner this is done for a couple of reasons:
A homeowner wants to build a Backyard Cottage or ADU and finds it difficult to finance without subdivision. Banks are more likely to loan to an applicant who owns the land outright but is less likely to lend on a property where there is a house AND you want to build an ADU. The banks want the homeowner to have significant equity for the second scenario. So, creating a flag lot helps them bridge that gap.
For example, most of the time backyard cottages (ADU’s) are built utilizing money from a home equity line of credit. By using the backyard, the lender is able to utilize the land as the collateral.
Banks typically say that they will finance 75% of a project. So, for example if I wanted to create a flag lot, the lot’s value could serve as the downpayment of the house. If the house would cost $200k to build, and a flag lot could be valued at $65k the total cost would be $265k. 25% of this would come from the land value, saving saving the homeowner from having to pull out cash from a home equity line of credit (you will want to discuss terms w your bank, of course, as the bank will want to consider the land value as part of the original note/mortgage).
The owner of the property may want to sell part of the land off — perhaps they are a landlord and want to maximize profits or they are a homeowner who wants their relative or friend to live in close proximity with the benefits of owning vs renting.
As land becomes more and more scarce and expensive (looking at you, Asheville & Savannah), we must look to our backyards where we have existing infrastructure in place. This is not only a way to promote smart growth but it is also a way to promote homeownership opportunities.
If you have examples of flag lots or other creative ways of development, please reach out to me. I love asking “why not” and exploring the outliers in cottage construction.
Interested in building a backyard cottage or development? Backyard Cottage Solutions is my cottage consulting business that explores these policies and how to creatively build for our challenging times. I’d love to connect with you!
