It’s now easier, more than ever before, to build an ADU in the City of San Diego. In a unanimous vote held by city council, new law updates have been passed to ease the ADU process with the goal of increasing the housing supply throughout the city. These laws make it easier to determine ADU feasibility and are aimed at reducing construction costs and other common hurdles that homeowners faced previously.
Since last year in 2019, the number of ADU applications has risen over 375%. Accessory Dwelling Units, or granny flats, have become very popular due to the many benefits ADUs can offer, such as:
- Rental Income
- Increase in property value
- Aging in place
The city’s new ADU building code updates are a combination of new changes as well as the implementation of existing state laws. Depending on how much you’ve been catching up with all the ADU laws both at the state and local levels, it can be a little confusing to differentiate between the two.
To help you better understand the new laws you should pay attention to, here’s a list of the 5 new ADU law updates recently passed by the City of San Diego.
1) Allows one ADU and one Junior ADU in a single-family zoned property.
The state of California passed this law earlier this year allowing single-family zoned properties to essentially have two ADUs. With the latest law changes, the City of San Diego voted this law into effect at the local level.
This means you can potentially have two income-generating units on your single-family zoned property. However, one important thing to remember is that junior ADUs come with a deed-restriction and require owner occupancy. This means that you can’t legally rent out all units on your property, since you will be required to live on the premises.
On the other hand, ADUs do not have an owner occupancy requirement. The best part is that if you build an ADU within the next five years, you are grandfathered into this owner-occupancy waiver.
What does this mean? You can potentially rent out your ADU and your main home should you decide to move and turn your property into an investment property.
Although having both an ADU and a Junior ADU on your property might sound great in the short-term. It’s important to assess your long-term goals and see if the owner-occupancy requirement that comes with a JADU makes sense for your investment strategy.
2) Allows ADUs up to 1,200 sq ft either detached or attached to the primary dwelling.
The state of California passed Senate Bill 13 which established the maximum size for ADUs to be 1,200 sq ft. However, the same bill limits the size of attached ADUs to only 50% of the square footage of the main dwelling (up to 1,200 sq ft). This means that if your main home was 1,000 sq ft, your attached ADU could only be 500 sq ft.
Now, things have changed. The City of San Diego now allows all ADUs including attached ADUs to be built up to 1,200 sq ft.
This opens up the opportunity for homeowners with lots that might not be big enough for a standalone detached ADU. Attached ADUs can maximize your yard space by eliminating the required 6 foot separation between the main dwelling and ADU. With the ability to build attached ADUs up to 1,200 sq ft, homeowners can now realize even more potential for their property than ever before.
3) Establishes an ADU density bonus program.
What’s a density bonus? A density bonus is when the city allows you to build more units than what your current zoning actually allows. The goal of the city granting a density bonus is to incentivize homebuilders and developers to create more affordable housing units.
1:1 Ratio
With the City’s ADU density bonus program, the city will grant the allowance of one additional ADU for every one ADU designated for affordable housing. This 1:1 ratio can significantly increase the buildable density for your property.
The density bonus is enforced by a deed-restriction on your property that lasts for a period of 15 years. The number of bonus units differs depending on how many affordable units you build and what zoning your property falls in. Within a transit priority zone, there is no limit on ADU bonuses.
To learn more about the ADU density bonus program, contact the San Diego Housing Commission.
4) Eliminates parking requirements for all ADUs, including detached, attached or garage conversions.
Up until now, the City of San Diego has required parking for units over 500 sq ft. However, this has changed with the elimination of parking requirements for all ADUs including new, detached granny flats.
Earlier this year, the state of California eliminated the requirement to replace parking from garage conversions. With the new updates, the City of San Diego officially voted this change into effect at the local level. This is a huge game changer, especially for properties with smaller lots where it can be a challenge to find ample space to build additional parking spaces.
5) Requires that ADUs and Junior ADUs can not be rented for less than 31 days.
This is another state law voted into effect at the local level. The city’s goal of easing restrictions for the development of ADUs is to increase housing supply for local residents. Therefore, this law update was implemented to curb the use of ADUs as short-term vacation rentals.
How do the new San Diego ADU laws affect you?
It’s easy to see that the City of San Diego has eased many of the building code requirements that used to restrict many homeowners’ abilities to build an ADU on their properties.
Homeowners can now have potentially two income-generating units on single-family zoned properties and are able to build larger attached units as well. The elimination of parking helps to further maximize the building potential on lots that can’t support a large detached unit.
Benefits for Multifamily Investors
If you are a property investor with multifamily zoned property, the density bonus program is a huge opportunity.
You can potentially significantly increase your property’s density with the addition of just one or two affordable housing units. Better yet, buying property in a transit priority zone can provide you with an unlimited density bonus.
These ADU law updates make it possible to increase the number of units you’re allowed to develop even if you’ve reached the maximum density for your property’s zone.
ADUs are one of the most profitable value-adds anyone can make to their properties. Who wouldn’t want to enjoy the income from an additional dwelling unit?
Looking for a property with ADU potential?
It can be overwhelming to navigate the many ADU regulations that are ever-evolving. Therefore, it’s important to work with a real estate professional who is familiar with local zoning codes and is up to date with the latest law changes to help you ensure that you are making the right investment.
If you’re a buyer looking to invest in a property with ADU potential? Let’s talk. Whether your goal is to enjoy rental income or provide a home for an aging parent, there are so many benefits to having an ADU on your property.
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