A new pipeline of starter homes
Downsize and stay in community
Multigenerational living flexibility
Reduce or eliminate mortgage debt
Lower-cost, faster permitting
More financing options
Thousands of ADU condos successfully created in
Portland, Austin, Seattle and many other cities
Overhoused homeowners are stuck
without options for downsizing
Families can live together on a lot, but with
separate ownership, financing and ability to sell
Aging in place and retirement option.
Sell one condo and live mortgage-free
Leverages the streamlining of
California’s popular ADU laws
Condo purchase/construction financing
options are abundant, including Fannie
and Freddie.
AB 1033 established the right for ADUs to be sold
separately as condos in CA jurisdictions that opt-in to the allowance. Casita Coalition, the trusted statewide
nonprofit authority on ADUs, worked with Reuben,
Junius & Rose to draft a model local ordinance
compliant with state law. Join the City of San Jose,
Berkeley and others to adopt ADU Condo ordinances!
Only 15% of Californians can afford to purchase a
home. The economic impacts to the state,
communities and families are immense. ADU starter
homes commonly sell for 30-40% less than single
detached homes, creating an attainable new starter
home supply for those priced out of the market.
A Powerful New Tool
Why opt-in?
Existing Opted-in
casitacoalition.org
Seattle WA
Portland OR
Texas
New Jersey
City of San Jose
City of Berkeley
Santa Monica
City of Santa Cruz
West Hollywood
San Francisco
Model Local
Ordinance and
Guidance Memo by:
AB 1033: ADU STARTER HOMES
Find more resources online:
With only 15% of Californians able to afford the median priced home, the situation is critical.
The lack of homeownership opportunities in our communities keeps the majority of us from ever dreaming of homeownership.
It also harms our economy, forcing many into long commutes or into leaving the area entirely, while worsening the racial wealth gap.
Opting in to ADU condos will create a pipeline of attainable starter homes, give vulnerable older homeowners more options for aging in place and downsizing, and make neighborhoods more inclusive–all without public subsidy.
The provision for separate sale of ADUs was already established for nonprofits–AB 1033 extended the opportunity to other homeowners–but requires cities and counties to opt in.
This is not a new concept–many thousands of ADU condos have been built and converted in Austin, TX, Portland OR, Seattle WA and other places around the U.S. Where ADU condos are commonplace, they often sell at 40-60% of the average value of single detached homes in the same neighborhood.
In regions with rising home and land costs, existing lower-cost older homes are too often replaced by large single homes, creating displacement and gentrification. ADU condos provide builders with a way to build smaller, more attainable homes profitably.
Key Points:
casitacoalition.org
ADU STARTER HOMES
TALKING POINTS
ADU Condo Benefits:
Provide attainable homes for purchase at 40-60% less than single detached Make neighborhoods more inclusive
Help stabilize homeowners
House workers near amenities and jobs
Keep local and state economies vibrant
Help businesses attract and retain new employees
Help repair the racial homeownership and wealth gap
Provide flexible solutions for multi-generational living Complement down payment assistance programs and other incentive programs for first-time homebuyers
Anybody who has tried to buy a home recently knows that there are simply not enough housing options available, and that the competition over existing homes is pushing prices out of reach for working people.
California has the second lowest homeownership rate in the nation. And starter homes are just not being built.
Unless we build more homes to buy, people will be priced out of the places where they grew up or built their lives.
Modest, affordable housing options like condos and townhomes enable average people to put down roots, own their own home, build wealth, and provide a solid foundation of economic stability and opportunity.
We need home choices that young people can afford in order to keep families together.
We need affordable home choices that allow older adults to downsize in their community.
Starter homes build solid foundations of economic stability and opportunity, but starter homes are the rarest type of new construction in our state.
We can leverage the success of ADUs in California to create a new source of starter homes in our own backyards.
ADU condos are common in Seattle WA, Portland OR, Austin TX and other places around the country, creating lower cost starter homes. In places where they are common, they are selling for 40-60% less than standard single detached homes.
Casita Coalition sponsored AB 1033 so that Californians would have the same opportunities to convert ADUs to condos and sell them separately.
Many kinds of property can be converted into condos in California–apartments, retail spaces and many others. Now accessory dwelling units have been added to the list.
ADU condos are more affordable than one-home-per-lot detached homes because they’re smaller and the cost of the land is less.
Making original home a condo makes that more affordable too! Opting in and allowing ADU condos doesn’t change what can be built, it just adds another option for ownership.
Condos provide builders with a way to build smaller, more attainable homes profitably.
Tested Middle Housing Messaging:
casitacoalition.org
ADU STARTER HOMES
TALKING POINTS
casitacoalition.org
ADU STARTER HOMES
TALKING POINTS
Dealing with Common Objections:
Objection: Our neighborhoods will become overcrowded if we allow this.
Answer: Opting in to AB 1033 doesn’t change what can be built, it just adds flexiblity to how it can be owned. Nonprofits already had this option, now all homeowners will.
Objection: This is untested--nobody knows if it will work.
Answer: Thousands of ADU condos have been created and sold in Austin, TX, Portland OR, Seattle WA and Princeton NJ, among other places. ADU condos are popular with buyers. In Seattle in 2022, ADUs sold for 47% the cost of a standard detached home.
Although new to California, it’s not a new idea. It uses established CA rules like the DavisStirling Common Interest Development Act and the Subdivision Map Act.
Many kinds of structures can be converted to condominiums in California--apartments, offices, retail spaces. Opting in to AB 1033 adds accessory dwelling units to the list.
Objection: They can’t be financed.
Answer: Financing to build or purchase condominiums is readily available.
Objection: People will sell ADUs in substandard condition.
Answer: AB 1033 requires ADUs to have either a certificate of occupancy or to pass a health and safety inspection before they can be converted to a condominium unit.
Objection: Tenants in ADU rentals will be displaced.
Answer: Most cities already have existing rules to protect tenants in condo conversions.
In the places where ADU condos have been legal for years, the majority of ADU condos are built from the ground up to be condos and don’t have rental tenants.
Objection: No one will build ADUs as rentals if they have this option.
Answer: Homes are needed for ownership as well as rentals. Starter homes are the most underproduced housing type.