The Atlanta City Council unanimously passed a new infill law 14-0 on Monday that restricts builders from developing oversized homes on smaller lots, but still allows for the construction of modern-style new homes.

Neighbors in many of the city's older sections started complaining a few years ago when builders put up new 5,000- and 6,000 square feet homes on small lots. Since many of the homes in the older neighborhoods are 1,500 to 2,000 square feet, residents complained that the larger homes blocked sunlight and looked lopsided compared to the existing homes, thus ruining the character of the neighborhood.

The new law sets a maximum floor area ratio for each home, a measure that essentially caps how much livable space a builder can build per home. For example, on a typical 7,500 square-foot lot, builders can now only develop a 4,125 square-foot home.

"The builders are fine with the new law, because it still allows them to build a sizeable market rate home," says Chris Burke, vice president of government affairs for the Greater Atlanta HBA.

However, Burke says builders are concerned about a provision in the new law that limits builders to two retaining walls in the side yard and another two in the rear yard of 6 feet each. Burke says the builders pushed to have the language say "6 feet or based on engineering design standards," but they lost that battle.

"We think it will be hard to limit the retaining walls to 6 feet," says Burke. "Atlanta's topography is very tricky," he adds, saying that the builders' main fear is that their projects will get held up when they apply for variances.

The real issue is side yards, where Atlanta's steep topography often pushes builders to construct individual retaining walls in the side yards well in excess of 10 feet. Neighbors complained bitterly that the high retaining walls block sunlight during the daylight hours.

"The builders have a total of 12 feet to work with in both the rear and side setbacks," says Ryan Taylor, director of communications for the Atlanta chapter of the American Institute of Architects.

Taylor says the new law also allows two retaining walls of three feet each in the front yard, a 12-foot wall for the driveway, and lets builders do basically whatever they want in the buildable area.

"Once they get into this, the builders will see how flexible the law is," says Taylor. "I really do think the new law accommodates the majority of properties in the city," he concludes.

Taylor co-chaired the Atlanta Infill Development Panel, the group that essentially drafted the new law. The panel consisted of the Atlanta HBA, as well as local realtor and architect groups. Also included were remodelers, planners, preservationists, and a representative from the neighborhood planning units, a series of 24 citizen advisory councils that make recommendations to the mayor and city council on land use issues. The infill group worked on the new law for roughly 20 months, holding numerous public hearings.

The infill law was also a coup for Councilman Mary Norwood, who worked closely with the residents and business groups and is said to be seriously considering a run for mayor in the 2008 elections.

Learn more about markets featured in this article: Atlanta, GA.