Attention all real estate investors and property owners in San Diego! Brace yourselves for the exciting news that will revolutionize the construction of additional dwelling units (ADUs) in California.
Recently, California has passed new legislation that will significantly change the construction of accessory dwelling units (ADUs). Governor Newsom signed
three bills, SB-897, AB-2221, and AB-916, on September 28, 2022. If you've ever dreamed of building the ultimate ADU, this is your chance to make it a reality!
Keep reading to learn more about these exciting changes that California will witness in 2023.
But first, let’s
clarify what exactly ADUs are.
What are ADUs?
An Accessory Dwelling Unit (ADU) is a self-contained housing unit that is attached or detached from an existing residential property. ADUs are a cost-effective way to add more housing options in California, as they use existing land without consuming additional space and are relatively cheaper to build compared to buying or constructing a new rental property.
Benefits of Adding ADUs
Here are some of the benefits of ADUs:
Increased Property Value
According to a study by the National Association of Realtors, adding an ADU can
increase a property's value by up to 35%. This is because ADUs provide an additional living space that can be rented out for additional income.
Affordable Housing
By adding a smaller, more affordable housing option to an existing property, homeowners can help address the housing crisis in their area.
Sustainable Living
ADUs have the potential to promote sustainable living by utilizing existing space on a property and reducing the need for new development and undeveloped land.
ADU Bonus Program and Transit Priority Zones
In California, homeowners who build deed-restricted ADUs as affordable housing for low-, low-, or moderate-income households are eligible for an ADU bonus.
Certain jurisdictions have adopted a Transit Priority Zone (TPZ) program, where homeowners can construct one bonus ADU for every affordable ADU built if there is mass public transit usually within ½ mile. Outside of TPAs, homeowners can build one bonus ADU in exchange for every affordable ADU constructed.
New Amendments in the Law
The new ADU laws implemented in January 2023 can provide opportunities for investors to increase their rental income by building additional units on their existing property.
Additionally, the density bonus offered for building ADUs in moderate-income areas can provide an incentive for those interested in affordable housing.
Nevertheless, investors must consider financing options to fund their ADU construction projects and make sure they are in compliance with the new regulations.
Relaxed Height Restrictions
Under previous regulations, local governments imposed a height limit of 16 feet for ADUs. However, the new ADU law updates now allow taller ADUs in certain circumstances.
Detached ADUs can reach up to 18 feet in height if the property is within a half-mile radius of a major transit stop, a high-quality transit corridor, or a multi-story multifamily dwelling. Attached ADUs can be up to 25 feet high or match the height of the main house, whichever is lower.
Permit Application Review Process
The new ADU laws require local jurisdictions to provide a detailed list of reasons for ADU permit application rejections, including specific elements considered “defective or deficient” and suggestions on how to address them. This simplifies the process of obtaining a building permit for an ADU.
Onyx Is Your One-Stop ADU Resource
