Can New California ADU Laws Boost the Housing Supply?

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According to the New York Times, the housing crisis in California is driving up the national homelessness rate. At present, housing experts estimate that the state is suffering a shortage of up to four million homes. However, there’s good news. In 2019, California passed new legislation concerning ADUs (Accessory Dwelling Units), which will help alleviate California’s housing crisis.

What is an ADU?

ADUs are known by many names: in-law apartments, granny flats, secondary housing units, or guest houses. Basically, an ADU is an additional residential unit that’s located within or attached to an existing residence. Meanwhile, some ADUs are built separately but located on the same lot. ADUs can be rented out to others and also provide a source of income for homeowners.

California’s New ADU Laws

Below, we summarize the main points of California’s six new ADU laws:

AB 68 and AB 881

These two deal with similar matters.

  • They greatly reduce setback requirements, so ADUS can now be built on land previously considered too small. Former setback laws specified minimum distances ADUs had to be “set back” from a street.
  • More than one ADU may be built on the same lot.
  • A JADU (Junior Accessory Dwelling Unit) may now be added to an existing property that also has an ADU on the same lot. A JADU is a small living unit within an existing home. It may be created by converting a bedroom into a self-contained unit.

SB 13

  • Previously a homeowner had to replace parking spaces if existing ones were eliminated. So, a two-car garage could be converted into an in-law apartment if two new sheltered parking spaces were created. SB 13 removes this requirement.
  • If, however, parking spaces are removed, and the property is more than half a mile from public transport, there must be available parking. However, a parking space for the ADU can simply be the existing driveway.
  • The five-year owner-occupancy rule is removed.
  • Development impact fees for ADUs under 750 sq. ft. are eliminated, reduced for larger ADU units, and are now proportional to size.
  • Approval time for ADU applications is reduced to a maximum of 60 days.

AB 57

  • If a not-for-profit company owns the existing property and builds single or multi-family ADUs for low-income owners, they may be sold separately from the main home.

AB 670

  • HOAs (Home Owners Associations) may not prevent a homeowner from building an ADU.
  • The HOA may place “reasonable restrictions” on ADUs pertaining to unit sizes, aesthetics, and rental periods.

AB 671

  • Government incentives for ADUs offering affordable rental agreements are available.
  • A list of state grants for ADU projects will be made public to encourage affordable-rent unit construction.

Other California ADU Laws

Other regulations, some of which have been codified law for some time, support the above legislation. To get a more complete picture, it’s worth noting that:

  • ADUs built without approval, and which may be vacant as a result, can now be inspected and brought into compliance for occupancy.
  • ADUs may be built at the same time as primary residences.
  • All zoning districts which allow single-family homes must now permit ADUs.
  • San Diego County ‘s Planning and Development Services (P&DS) supports the new state legislation and has?published SIX approved ADU floorplans?plus application checklists to help homeowners submit their plans for ADUs.
  • P&DS has also published additional details on ADUs including?approved square footage for attached and detached units.

The Benefits of the New California ADU Laws

California’s housing crisis could, to some extent, be blamed on “limitations and cost.” Former legislation that made it more difficult to build a residence in this state has contributed to the housing crisis. The new ADU legislation will shift the paradigm from those factors to “greater availability, increased options, and lower costs.”

The ability to build small, self-contained residences on existing lots may add hundreds of thousands, if not millions of new homes, to California cities and suburbs. The homes may be occupied by family members, sold, or rented out. Smaller, low-cost construction encourages lower sale prices or lower rents. Either way, the new laws promise to make more homes available to San Diego residents and to increase opportunities for investors to add to their investment portfolios.

If you’re a homeowner or investor looking for more information about ADUs, get in touch here. I answer all serious inquiries and will work with you to meet your housing and investment goals.