5 Things to Know about Bay Area ADUs
It’s no secret that housing in the Bay Area is in high demand, with a major supply issue that is being addressed with new legislation and creative housing options.
Bay Area ADUs are one of those creative solutions to the housing crisis. If you’re a Bay Area homeowner, here are 5 things you will want to understand about ADUs.
But First: What is an ADU?
An Accessory Dwelling Unit, or ADU, is a second, smaller dwelling built on the property of an existing single family home. They are called by many names, like granny flats, mother-in-law units, tiny houses, and guest houses.
If you plan to build an ADU or get an existing structure on your property ready for use as an ADU, there are some things you need to understand to avoid legal issues down the road.
Why Build an ADU?
Building an ADU might be the right choice for you if you are looking for a place for your parents to live, but are not yet ready to have them in your home. Perhaps they would like their privacy and independence but want to be close for future care. A Bay Area ADU is a great solution in this scenario, offering a shelter from the rising costs of housing for retirees while keeping them close to you.
Bay Area ADUs are also a popular choice for parents of adult children who are looking for affordable housing while in college or launching a career. Even as a temporary solution, you can offer housing to your adult child while they need the support and then transition to using the ADU as an income property in the future.
Many experts anticipate ADUs as one of the major solutions to the Bay Area housing crisis. Using your ADU as an income property may present a significant passive income stream while increasing the value of your home, possibly as much as 34%.
1. Just because the structure is permitted doesn’t mean it’s legal for use as an ADU
Bay Area ADUs are required to meet certain standards to be legally considered an ADU for renting. To be considered an ADU in California, the structure must:
- Be a self contained space with its own entrance, bathroom, and kitchen space
- Range between 250 and 850 square feet if it has one bedroom, or up to 1,000 square feet for more than one bedroom
- Be up to 16 feet tall
Individual cities may have their own requirements for ADUs, so make sure to reach out to your city’s planning department before beginning your construction process.
2. An ADU is not the same as a vacation rental
As the popularity of AirBnb and VRBO have grown, an increasing number of people are considering how they might enter the short term vacation rental market. While this can be a lucrative business, remember that a Bay Area ADU may be regulated differently than a vacation rental.
Depending on what county you are in, you may not be allowed to use the ADU for a short term rental. Check with your city before solidifying your plans.
3. It’s not worth it to risk renting an ADU without the necessary permits
You may think you can rent out an ADU without following all the rules, but keep in mind that if the tenant sues you or your lack of proper permitting and contracts is revealed, you may be required to pay back all of the rent you received from the tenant.
Make sure to acquire all of the necessary permits and a certificate of occupancy before beginning to use your Bay Area ADU.
4. ADUs are a useful solution for a variety of puzzles
Adding an ADU to your property can solve a variety of problems. A Bay Area ADU can be useful for:
- Housing for parents
- Rental income
- Housing for adult children
- Short term guest housing
- In-home healthcare providers
- Childcare, such as an au pair
5. An ADU does not have to be built on site
If you are concerned about construction timelines, messes, or other potential hassles, remember that your Bay Area ADU can be a prefab structure.
One Bay Area business even guarantees the delivery of their prefab ADUs within 6 months, and paperwork turnaround in a matter of days for customers local to their San Jose office.
To learn more about creative housing solutions in the Bay Area, or for any other real estate questions, contact us today and find out why our clients choose us again and again!
Amar Realtor offers expert real estate services with proven results in the Cupertino real estate market as well as outlying areas including homes for sale in Milpitas, San Jose, Campbell and properties in San Mateo County, homes in Contra Costa and Alameda County.