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What is an ADU?
Granny flat. In-law unit. Guest house. Accessory Dwelling Unit. ADU.
Whatever you call it, it’s the smartest way to invest in your property while helping solve the Bay Area’s housing shortage.
There have been sweeping changes in California law that make it easier for you as a homeowner to build ADUs and contribute to the housing supply. Learn to make your property work for you!
Why should you build an ADU?
ADDITIONAL INCOME
Rents are rising and availability is dropping, making this an ideal time to put your property to work by building a money-making rental unit. Earn income to help pay down your mortgage or fund your retirement.
The average rent in Berkeley was $3,213, $2,935 in Oakland, and $2,506 in Walnut Creek, according to a 2020 report released by Rent Café, a nationwide apartment search website.
MULTI-GENERATIONAL LIVING
Seniors increasingly prefer to age-in-place rather than move into a retirement facility. Building an ADU provides creative, flexible, and affordable housing for aging parents.
It’s also the solution for families with young adult children living at home. In California, nearly 40% of young people aged 18 to 34 haven’t left the nest. Moving them into an ADU is a great way to give them – and you – space so you don’t drive each other crazy.
WORK FROM HOME
After the COVID-19 crisis wanes, many people will continue working remotely. Building an ADU provides that quiet, dedicated home office you’ve been dreaming of after months of trying to conduct conference calls without kid interruptions or barking dogs.
GUEST ACCOMMODATIONS
Are you tired of putting your occasional out of town guests on the couch or your kids’ bottom bunk? An ADU is an excellent solution for out of town visitors. You may find, once you have an ADU, you get to see those loved ones more often.
INCREASED PROPERTY VALUE
While it’s difficult to quantify exactly how much resale value an ADU adds to a property, anecdotal evidence shows that homes sold with secondary units have a higher return on investment.
The in's and out's of ADUs
An ADU is...
- Self-contained living space with its own entrance, bathroom, and kitchen.
- As small as 250 square feet and as large as 850 square feet, or 1,000 square feet if the ADU contains more than one bedroom. Individual California cities might allow larger units, however, so check with your local planing department.
- Up to 16 feet tall.
What are the different kinds of ADUs?
- Detached – pre-fab or constructed from the ground up
- Attached addition to your main home
- Conversion of an existing space, such as the garage or basement
Who is an ADU for?
- Renters
- Aging parents
- In-home health care providers
- Young adult children
- Au pair child care providers
- Home-based workers
CALIFORNIA ADU FASTRACK
Once upon a time, property owners had to tolerate drawn-out public hearings and permit reviews that took up to two years. But local lawmakers have cleared a lot of red tape and costs in recent years.
- Local planning agencies must act on an ADU application within 60 days, without requiring a hearing, discretionary review, or neighbor notification.
- Some ADUs are eligible for automatic approval as long as they are no taller than 16 feet and include rear and side setbacks of 4 feet. Auto approval applies to: An ADU converted from existing space, such as a garage or basement; and a detached ADU that is 800 square feet or smaller.
- Local agencies cannot charge impact fees for ADUs under 750 square feet. Fees for larger ADUs are limited.
- Homeowners associations (HOAs) must allow the construction of ADUs.
- ADUs cannot be considered new residential uses for the purpose of calculating utility connection fees or capacity charges, including water and sewer service.
- State law prohibits cities from requiring a minimum lot size for ADUs that are 800 square feet or smaller.
- Side and rear set-back requirements are capped at 4 feet.
- Parking requirements are reduced to one space per bedroom or unit. Extra parking is not mandated for ADUs located within a half mile of public transit, within one block of a car share area, in an architecturally and historically significant historic district, within an existing primary residence or existing accessory structure, or in an area where on-street parking permits are required but not available to the occupant.
ADU Resources
- “Inspired Backyard Living” – Short explainer video by the architectural firm Inspired ADUs, which is based in Berkeley and Woodside. The Inspired ADUs website also has some great before-and-after photos.
- AARP’s “ABCs of ADUs” – A guide for people of all ages.
- Full text of California’s ADU laws that went into effect Jan. 1, 2020.
- “Do You ADU?” Read our blog post for more info.
Let’s get started
Whether you’re a first-timer or seasoned real estate investor, we’d love to work with you.
