Why Should You Build an Accessory Dwelling Unit?
The future of Silicon Valley‘s economy depends partially on giving people more options for living near their workplaces at an affordable price. ADUs AKA granny flats, in-law apartments, casitas might be one of the solutions toward closing the housing gap in our area for a simple reason: ADUs are smaller and more affordable than traditional housing options and would help low- and moderate-income renters weather the skyrocketing housing costs.
The benefits for both homeowners and renters are easy to see: renters are searching for relief from high housing costs and ADUs can be an excellent investment for homeowners. It’s a win-win situation requiring minimal compromise.
Why Investing In An ADU?
An accessory dwelling unit (ADU) is a secondary housing unit on a single family residential lot. It can be attached to the primary house like a converted garage, or unattached like a freestanding cottage. Homeowners can create ADUs from new or existing structures.
1. ADUs offer a stable rental income for homeowners who choose to rent their unit. Homeowners looking to build or repurpose a structure in their backyard, garage, home or basement will have little trouble finding competitive renters.
2. Homeowners will also find that adding an ADU is oftentimes an affordable investment. For instance, repurposing an existing structure like a garage or basement is cheaper than buying an investment property since most homeowners already own the land on which they might build or repurpose their ADU, they won’t have to clear this extra financial hurdle.
3. One study found that ADUs contributed between 25% and 34% of each property’s assessed value, according to the Appraisal Journal (https://bit.ly/1H1bSHc). Nevertheless, bear in mind that this figure may vary depending on where the ADU is located. Therefore, only a local real estate agent may be able to help you evaluate the added value to a home when building an ADU.
How Difficult Is It To Create An ADU?
Since 2016, we saw a real shift regarding the legislation pertaining to the construction of AUDs. California lawmakers now recognize ADUs’ potential to help alleviate the state’s housing crunch. Below is a recap of the key recently enacted, ADU-friendly laws include:
Senate Bill 1069, which prohibits parking requirements if the ADU is within a half mile from public transit;
Assembly Bill 2406, which authorizes local governments to allow for the construction of junior accessory dwelling units of no more than 500 square feet and fully contained within an SFR. It also prohibits local agencies from requiring additional parking requirements for junior ADUs, treating these tiny units as part of the same SFR unit when it comes to installing water, sewer and power so a separate connection fee cannot be required for the junior ADU.
Assembly Bill 2299, which loosens regulations around all types of ADU. The new law:
a/ Limits parking requirements for all types of attached or unattached ADUs to one parking space per unit or bedroom and provides maximum standards a local government is authorized to issue on ADUs (for example, an ADU may be built on the property even if it is zoned for SFR use only);
b/ Removes the setback requirement for ADUs built inside an existing garage;
c/ Limits the setback requirement to no more than five feet from the side and rear of the lot for an ADU built over a garage.
As the result of these "pro" ADUSs legislation, in the city of San Jose, for instance, ADUs are permitted where most single-family homes exist, if it meets the standards outlined in the Municipal Code and as applicable in planned development (PD) districts. More specifically, ADUs are allowed in residential R-1, R-2, and R-M zones, and in PD zones as allowed by the covenants of the PD zone.
Feel free to contact me to get your free handout of the city of San Jose ADUs, requirements and/ or any other city in Santa Clara County.
The City of San Jose Accessory Dwelling Unit (ADU) Amnesty Program: Your Pathway to Legalized an unpermitted ADU
Did you construct an accessory dwelling unit (ADU) or convert a garage, basement, or room into a separate living unit — also called an ADU — without obtaining a building permit? Or, did you buy a property with an un-permitted ADU? Insurance companies will not cover a fire, damages, or injuries relating to an un-permitted unit. Protect both occupants and yourself by legalizing your unit.
The City of San Jose ADU Amnesty program waives penalties and may help you save more than $10,000 in fees while you take the steps to legalize your unit, improve the unit’s safety for occupants, and reduce your liability. The program allows for using the building codes from the year the unit was built, and provides 5 years to complete items not relating to immediate health and safety issues.
You can explore the program without disclosing your name and address by reviewing the Self-Assessment Checklist, and then calling the ADU Amnesty Coordinator with your questions. Learn more here.
This program is set to end in January 2022.
Overview of California Accessory Dwelling Unit (ADU) Law as
of January 1, 2020
Reduced Costs and Burdens for Developing ADUs
ADU applications must be approved within 60 days, without a
hearing or discretionary review;
For ADUs permitted by 2025, cities/counties cannot require
the owner to live at the property;
No impact fees are required for ADUs under 750sqft;
proportional fees apply to larger ADUs;
An ADU can be developed at the same time as a primary
dwelling, under most of the same rules;
A city/county must delay code enforcement on an unpermitted
ADU to allow it to be legalized;
Single-family HOAs must allow development of ADUs, subject
to reasonable standards;
Single-family homeowners can also develop JADUs—units under
500sqft within a residence.
ADUs Subject to Automatic Approval — No Local Limits
Cities/counties must permit certain categories of ADUs
without applying any local development standards, if proposed on a
single-family lot. ADUs eligible for this automatic approval include:
An ADU or JADU converted from existing space in the home or
another structure (e.g., a garage), so long as the ADU has exterior access and setbacks sufficient
for fire safety
A new detached ADU under 800sqft in size, 16 feet in
height, with 4-foot side/rear setbacks;
Both of the above options in combination, creating one
internal JADU and one detached ADU.
ADUs Subject to Ministerial Approval — Minimal Local
Cities/counties must generally approve an attached or
detached ADU under 1,200sqft unless it adopts local development standards. Local standards have the
No minimum lot size requirement;
No maximum unit size limit less than 1,000sqft for a
No required replacement parking when a parking garage is
converted into an ADU;
No required parking for an ADU created through the
conversion of existing space or located within a half mile walking distance of
a bus stop or other public transit;
No height limit under 16 feet or side/rear setbacks
requirements over 4 feet;
No setbacks requirements for conversions/replacements of
existing legal structures;
Design standards must be objective and are assessed by
staff, not elected officials;
Floor area ration (FAR) and similar restrictions must be
relaxed to allow development of an 800sqft ADU.
Adding Units to Multi-family Properties
The following types of residential units can be added to
multi-family buildings, with no local limits:
New units within the existing non-living space of a building
(storage rooms, basements, garages, etc.), with one new internal unit allowed for every four
Two new detached homes, with 4-foot side/rear setbacks, up
to 16 feet in height.
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