With recent data showing even higher hurdles to home ownership in California, a spate of new laws were passed this session to help produce more Accessory Dwelling Units (ADU), which are smaller scale units that share the lot of a single family home.
Types of ADUs include a basement apartment or backyard cottage.
Much has been done to boost ADU production, including ADU financing programs in the state budget, and providing grant money, Assemblymember Phil Ting, D-San Francisco, told the Northern California Record by email.
Many of Ting’s bills on ADUs were signed by Gov. Gavin Newsom in this legislative session.
“Over the last few years, the Legislature has seen the potential impact ADUs have on easing the housing shortage and passed several key pieces of legislation to ease the approval process and decrease the time it takes to build an ADU,” Ting said. “The Terner Center estimated in 2020 that these changes created market potential to build close to 1.5 million additional housing units. ADUs are not the only answer to the state’s housing crisis, but they are a part of the solution.”
Ting noted that SB 104, a budget bill that was signed by Newsom in September, will provide an additional $25 million for the ADU Grant Program.
Apart from that, Ting authored other ADU-related legislation that was signed by Newsom:
- AB 932: Directs CalHFA (California Housing Finance Agency) to explore ADU financing options to create more housing and report back to the Legislature by 2025.
- AB 976: Removes requirement that ADUs be owner-occupied.
- AB 1033: Allows ADUs to be sold separately as condominiums, opening the door to affordable homeownership. According to the Assembly Floor Analysis, California’s statewide median home price is roughly $800,000, a price that is affordable to only 17 percent of California households.
Ting hopes this year’s actions build on his 2019 legislation, AB 68, which has made it easier and faster to build an ADU. It was among a group of laws that expedite the permit approval process, allow for larger units, ease parking requirements, and reduce fees. These efforts are credited with starting an ADU construction boom.
Construction costs vary by location and type of the ADU; in California the price for a free-standing ADU can be anywhere from $100-$500 per square foot. Industry estimates show that roughly 30,000 ADU permit applications were filed in 2022.
“California consistently falls short on housing,” Ting said. “For decades, a lack of dedicated resources have contributed to a supply and demand imbalance, leading to a statewide housing crisis. In addition, ADUs can be built quickly and fit into existing neighborhoods. We must look at all avenues to increase construction, and with ADUs, homeowners can help play a role in the solution.”
Newsom has pledged to create a “Marshall Plan” for affordable housing and signed 56 pieces of related legislation this year.