Update on ADU Legislation – 2019 By: D. Keith Dunnagan, Esq.

Housing shortages and affordable housing have been central issues in California real estate for many years. As supply continues to shrink and demand increase, these issues will only become more prevalent. In 2019 the California Assembly took steps to begin tackling some of these issues with a series a laws aimed at making it easier to construct accessory dwelling units (aka “ADU” or “granny flats”). Today, we look at some of the new laws related to ADUs that passed in California in 2019.

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Update on ADU Legislation – 2019
By: D. Keith Dunnagan, Esq.

accessory dwelling units ("ADU")Housing shortages have been a constant theme throughout the year in California. It started with Gov. Newsom’s first budget proposal in January 2019 pledging the construction of 3.5 million units over the next 7 years. While there has certainly been legislation aimed at housing, some of the more promising developments have been the passage of a series of bills aimed at reducing barriers to the development of accessory dwelling units (“ADU”).

Over the course of the legislative session this year, five bills were passed that aim to streamline the permitting process for ADUs or address restrictions that limit ADU development.

A significant victory for landowners was the apparent elimination of impact fees charged when permitting ADUs smaller than 750 square feet under SB 13. Additionally, the same bill addressed difficulties that many have with cities and agencies conditioning approval of an ADU on owner-occupancy of either the ADU or the primary residential dwelling. Such conditions reduce the ability to develop ADUs in an era where many are renting. The passage of this bill is a significant victory for homeowners and investors alike.

Another significant win came with the passage of AB 670. Many neighborhoods in California are regulated by Home Owners Associations or subject to CC&Rs. In many of these instances the HOA or CC&Rs regulate, restrict or even outright prohibit the construction of ADUs. This particular bill addresses these HOA restrictions and makes it unlawful for an HOA to “prohibit or unreasonably restrict” the development of ADUs on residential lots. This provision is limited to single-family residential lots, but the bill expressly provides that outright prohibition or unreasonable restrictions are void and unenforceable. The biggest question from this bill is how will “reasonable restriction” be determined going forward. Nonetheless, this is a benefit for homeowners living in HOAs.

Many who want to develop ADUs are stuck in the permitting process and get discouraged and simply quit the process. However, under AB 68, once a completed building permit application is received the local agency is now required to approve or deny that application within 60 days. This should help speed up the permitting decision process and curtail the lengthy wait times many individuals face when seeking to develop ADUs.

Other bills that passed addressed issues like the possibility of allowing an ADU to be sold separately from the primary dwelling (AB 587) and requirements on local governments to provide incentives in their general plans to encourage the development of ADUs (AB 671).

As California faces a significant housing shortage for the foreseeable future, new laws and regulations to streamline and improve development will be a benefit. These particular laws aimed at addressing the construction of ADU projects should assist homeowners and investors alike in their development of ADUs, which in turn, in theory should serve to begin to address the issue of affordable housing. If the provisions of AB 587 materialize, that could create additional opportunities for sales of housing units apart from the primary residential dwelling.

Needless to say, it has been an interesting year in the legislature related to promotion of the development of ADUs.


The attorneys of BPE Law Group, PC. have been advising our clients on real estate, business and estate planning issues for over 20 years and have assisted numerous clients in business and real estate matters and have represented and advised brokers on their professional obligations as well as consumers on their rights. If you have questions concerning legal matters, give us a call at (916) 966-2260 or e-mail Keith at kbdunnagan@bpelaw.com. Our flat fee consult for new clients may get you the answers you need for the questions you have.

The information presented in this Article is not to be taken as legal advice. Every person’s situation is different. If you are facing a legal issue of any kind, get competent legal advice in your State immediately so that you can determine your best options.