New ADU laws for 2020 Will Affect Los Angeles and San Diego Granny Flats
Published By Brittnay Sharer
Date: 12/15/2019
Recently legislation in California passed a package of laws in hopes of increasing the creation of new housing in neighborhoods consisting of single-family homes. Homelessness and the rising cost of rents and living have dominated news here in California in recent months. Common sense can tell us that housing and affordability aren’t going to get any better in the immediate future but with all the new and updated state laws that have been passed recently, advocates are hoping to empower homeowners to use their open spacer to increase new units and a way to help themselves and others.
What was the main reason for the new ADU/Granny Flats laws in the year 2020?
Well, that would be Accessory dwelling units, or ADU’s as they are most commonly known as. These are small homes, typically coming in under 1,000 square feet. ADU’s are built by homeowners on open spaces in their property. Five bills were signed into law this week giving Californians an easier ability to build ADU’s in their backyards. Before it was much harder to obtain permits and those who had already converted their garages were not permitted to also have an ADU. With these new laws, many single-family homes could be turned into triplexes with homeowners having the option of both a garage conversion and ADU addition.
The new laws are a big win for homeowners who have been wanting to add another rental unit to their property but were unable. Longtime ADU advocate State Sen.Bob Wieckowski, a Democrat who hails from the Bay Area says since the ease up of the ADU and garage conversion laws there has been a surge in construction, especially the big three; San Diego, San Francisco, and Los Angeles. Wieckowski has backed three successful ADU bills in the last four years. Sen. Wieckowski also stated that he believes ADUs to be a big part of a multi-part solution in California's housing shortage. He goes on to say he doesn't believe there is one single solution but rather several parts to make it easier. ADUs can help to create up to 900,000 units with 10% participation and even better at no cost to taxpayers.
One of the companies that are helping with the design of ADUs is ADU Architectural Designs located in Los Angeles.
Do these laws have the power to create an ADU building boom in Los Angeles, San Diego, and San Francisco?
Well, this a bigger question, with a really unknown answer as these laws change the game on ADUs. In reality, ADUs are not able to deliver the true number of units needed to help house the majority of everyone needing a home in California, although every bit helps. These particular slate of laws being signed into action by California Gov. Gavin Newsom, are to help create a rise in ADUs, which have been growing in numbers across the United States in recent years. Kol Peterson, a Portland-based ADU expert and recent author of a book on ADUs believes “we are only beginning to scratch the surface of how much of a dent ADU’s can make in the housing market.” He goes on to say that though single-family properties still dominate American metropolitan centers, with the ability to have two ADUs on a property we are almost tripling the capacity of just that property. From 2017 to 2018 alone permits for ADUs in California grew by nearly 50%, and around 7,000 were permitted this year. With the quick adoption of these new laws, California could see nearly 10,000 ADUs in 2020. Dan Berolet, a senior researcher at Sightlines Institute, after California changed ADU rules in 2017, they accounted for 1 out 5 building permits in Los Angeles alone. Bertolet also goes on to say he believes the biggest change was the elimination of lot size requirements, which held back many from being able to build an ADU/granny flats. Now that the new policy says that the owner-occupancy of ADUs is not required, homeowners can add up to two units per lot.
Biggest Challenge with ADUs is the Financing - Where to get money for an ADU?
As great as ADUs can be in helping with the housing crisis it does have one major drawback; financing the project. Belgrade states that the biggest issue is that banks haven’t quite figured out ADU’s; their market, how to lend for them. He goes on to say that banks need to come up with new loan ideas so that more people can complete an ADU. With current lending practices, many homeowners will not be eligible or able to get approved for the amounts needed to construct ADUs on their property. Bertolet agrees with this assessment. There are new laws seeking to help with this issue. A recently signed State Bill 13 eliminates excessive developer impact fees, which are often on-half the total cost in building an ADU. Financing is still a major hill though. Homestead is one ADU design company in Los Angeles that actually helps fund your ADU. Hopefully, in the months to come, we will see more improvements to help with financing so that more can afford to build. Even if it takes a few years to get going the building of ADUs will greatly help to decrease the ever-growing amount of available housing.