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I think OP is talking about a single building with single-family occupancy and commercial storefront. At least in the US, a lot of single-family residential zones exclude commercial use.

It's such a common building type that it has its own name

Nearly every old town square I've seen in the Midwest and the south has businesses on the first floor and apartments upstairs. And there are plenty of new urban apartment complexes being built with like 4 floors of apartments over restaurants and various shops. What idiot told this guy that this wasn't a thing?

Yeah very common in small towns around the square. Many of them are offices upstairs now too.

It's where the small town lawyer always lives in a John Grisham book.

On the flip side, you're stuck in a peaceful quiet suburb that's a mile or more from any business.

Zoning is a good tool used poorly. Restaurants and grocery stores being subject to zoning creates issues. My personal belief is neither should be subject to zoning (but still have the parking lots be.) Auto shops, manufacturing, and mining operation type things are examples of where zoning is good.

Zoning sounds great until you want to start a small business on your property, and you have to spend years convincing several councils and review boards that a photography business is not going to destroy the neighborhood character... and then you need to pay for a traffic study to prove it won't negatively impact parking or meaningfully increase car travel on the street. And if it manages to get approved, then some retired busybody with no life will complain at every town council meeting that it's attracting a bad crowd, and there's too many people around now.

There is definitely a place for reasonable limits, but almost nowhere in the United States has that. People need to accept that neighborhoods change, and expecting them to be frozen in time is literally insane and fiscally irresponsible.

Why is a next-door auto repair neighbour bad? Do you not have laws on noise?

If you live above a proper restaurant expect no roaches ever, because they can't afford for literally a single roach to be seen in their restaurant by their customers.

FWIW, I used to take my car to an auto shop located in the middle of a residential neighborhood, next door to an ice cream and bait shop. It did not affect the neighbors in any way that I could see, and didn't affect the property values.

I haven't read it yet, but arbitrary lines is a very cool book about the subject, and the exact opposite of what you are saying. The author defends that zoning is the wrong way of going about things and proposes other ways of controlling this issue.

I helped move some coworkers into an apartment directly over a bar in a decent sized bar district.

It was a cool pad, ancient, crazy 1800's storage warehouse vibe, a dozen great food options and breakfast places.

WOMP WOMP WOMP WOMP till 2am most nights. A vagrant that liked to crash on their doorstep and peed on the door most days. If they want out between X and Y hour, they'd have to shoo him off the little porch to get in.

My last place was directly over a karaoke bar. It was weird how the sound of drunk off key singing became a comforting sleep sound. I missed it when they shut down.

Also New York. And a lot of places, actually.

Im not living on site and working at the company store...

The number of managers that would come upstairs to knock on your door to get you to cover a shift; it angers me just imagining it.

Huh, what city in France are you talking about? Every city I've ever visited had mixed zoning with shops and restaurants in the ground floor and flats above. Of cause there are also blocks of houses without shops, but that's mainly because you need more space to house a certain amount of people than for them to shop.

I there are also suburbs where every house has like a 1000m² of garden around it, and of course these houses don't have a shop in their basement. But that's because people choose to live like that and not because it's the only option.

Ngl I live in Chicago so to me it seems like the norm rather than the outliar

It's totally a thing in the downtown of some older cities, and occasionally in some apartment complexes that have popped up recently, but I'd say that throughout the majority of the country, residential and commercial zones get drawn without overlap.

Is this actually illegal in the US? If so, where is it legal?

It varies by city, but typically the vast majority of land used for housing (upwards of 90% in some of the worst cases) is zoned for single-family detached houses only.

Small live-work places like this, with a single business on the ground floor and a single dwelling unit above, are likely typically in the single-digit percentages, in terms of land area zoned for that use.

(Even the vast majority of non-single-family detached housing wouldn't usually allow stuff like this, but would be medium to high-density apartment/condo buildings instead. The phenomenon of having a gap in housing density is so prevalent it even has a name: "missing middle".)