CA AB 1033 (Condo-ized ADU's)

ADU Assembly Bill 1033: Understanding the New Law's Impact

Assembly Bill 1033 (AB 1033) is a legislated effort in California that expands the potential for homeownership and boosts residence availability by allowing property owners to build Accessory Dwelling Units (ADUs) on their land and sell them separately. This new legislation marks a significant change to the traditionally stringent zoning laws, and aims to address the state's pressing housing needs.

As ADUs, also known as "granny flats," become a more popular and viable solution to the housing crisis, AB 1033 has important implications for homeowners, local governments, and the San Diego real estate market. By affording property owners the opportunity to construct and sell ADUs like condos, AB 1033 strengthens housing flexibility and affordability in California.

Key Takeaways

• AB 1033 enables homeowners to build and sell ADUs separately from the original residence.
• The legislation represents a shift in zoning laws to address California's housing needs.
• ADUs have become an integral part of the state's strategy to alleviate housing shortages.

The Basics of ADU Assembly Bill 1033

Intent and Purpose

The primary intent of the ADU Assembly Bill 1033 is to address California's housing crisis by providing more affordable and accessible housing options. This bill allows for the creation and sale of Accessory Dwelling Units (ADUs), commonly known as granny flats, which are smaller, independent residential units on the same property as a primary residence. The legalization of ADUs not only increases the property value but also opens up opportunities for rental income, as explained in this detailed article on the advantages of adding an ADU to your property.

Key Provisions

The AB 1033 introduces two main provisions. First, it allows ADUs to be sold separately from the main residence, creating greater housing density and more affordable homeownership options. Second, it supports a simple partition in-kind of single-family homes, which reduces the need for lengthy and costly legal proceedings. The bill complements other California housing initiatives, like SB 9, which permits lot splitting to increase the housing supply.

Moreover, the recent enactment of AB 1033 enables homeowners to capitalize on their existing equity by selling ADUs built on their properties. This new legislation applies to both newly built ADUs as well as existing ones, paving the way for more Californians to explore this option and address the growing demand for housing. Those looking to purchase an ADU or even find a home that has ADU potential can consult specialized real estate ADU listings catering to this niche market.

Implications of the ADU Assembly Bill 1033

Landowner Implications

The ADU Assembly Bill 1033 brings about several implications for landowners. First, it allows property owners to construct an ADU on their land and sell it separately, following the same rules that apply to condominiums. This provides landowners the opportunity to capitalize on their existing equity. When considering adding an ADU to a property, legal implications such as adhering to local regulations and zoning requirements should be taken into account.  

1. If the property is encumbered by a mortgage you would have to refinance off the APN number of the new unit.  

2. Setting up an HOA is costly and a process that would be required.  Here's a great article on starting and operating an HOA.

3. You will most likely want seperate gas, electric meter, and water.  Otherwise you end up splitting utilities with your new occupant.  We see this often on older condo complexes where there is one water meter and then water costs are part of the HOA dues.

Renter Implications

Renters may also experience changes due to the ADU Assembly Bill 1033. As more homeowners build ADUs, the amount of available housing for renters will increase, potentially leading to more affordable rental options. Additionally, the ability to sell ADUs separately may encourage more investment in ADU construction, thereby offering stable and modern living spaces for renters. Landlords considering renting out their ADUs should bear in mind the 10 things to consider before doing so.

Impacts on Housing Market

The introduction of AB 1033 should have a significant impact on the housing market in California. By encouraging the development of single-family type units like ADUs and duplexes within single-family zoned neighborhoods, the legislation aims to increase what is known as "gentle density". This will both increase the availability of housing and help offset the growing housing crisis. Furthermore, the ability to sell ADUs separately from the main residence under AB 1033 will likely lead to a boost in homeownership, making it more accessible and affordable to a broader range of individuals.

Passage and Implementation

Bill Passage Process

The journey of Assembly Bill 1033 (AB 1033) from conception to law marks a pivotal chapter in California's housing narrative. Sponsored by Assembly member Phil Ting in San Francisco, the bill was embraced and signed into law by Governor Gavin Newsom, signaling a paradigm shift in the state's housing policies.

Criticisms and Support

Criticisms and Controversies

Some concerns have been raised regarding Assembly Bill 1033 (AB 1033), particularly regarding its potential impact on local zoning laws and the character of neighborhoods. Critics argue that allowing ADUs (Accessory Dwelling Units) to be sold separately from the main residence could lead to an increase in density and potentially alter the overall feel of single-family neighborhoods. As stated by the LA Times, this change in zoning laws has garnered mixed reactions.

Some detractors also worry that AB 1033 may exacerbate existing housing inequities and contribute to gentrification, as property owners may be more inclined to sell their ADUs to developers or higher-income buyers. Additionally, there are concerns about the possible negative impact on rental availability, as homeowners may decide to sell their ADUs instead of renting them out.

Supporters' Perspective

On the other hand, AB 1033 has numerous supporters who see it as a means to increase affordable housing options and homeownership rates in California. They argue that allowing homeowners to sell ADUs could provide a new source of income and create more affordable housing opportunities for those struggling to enter the housing market.

Furthermore, supporters emphasize that AB 1033 could help alleviate the state's housing crisis by creating more opportunities for homeownership and increasing the overall housing supply. This new law may also have financial benefits for homeowners, as selling an ADU could potentially help offset mortgage costs and other expenses.

In conclusion, AB 1033 has both its critics and supporters, with each side highlighting the potential risks and benefits associated with the new law. As the legislation implementation unfolds and its effects become more apparent, the ongoing conversation about the role of ADUs in California's housing landscape will likely continue to evolve.

Frequently Asked AB 1033 Questions

How does AB 1033 impact ADU regulations in California?

AB 1033, recently enacted in California, allows for the separate sale or conveyance of Accessory Dwelling Units (ADUs) built on homeowner properties, potentially increasing housing options for residents source. This bill has implications for homeowners, neighborhoods, and communities as it creates additional opportunities for residential density in the state.

What changes does Assembly Bill 1033 propose for ADU construction?

AB 1033 specifically focuses on enabling homeowners to sell ADUs separately from their main residence, which was not allowed under previous regulations source. The bill may result in a rise in ADU construction as homeowners capitalize on their existing equity and offer additional housing options for potential buyers.

How does AB 1033 relate to previous bills like AB 1633 and AB 1287?

While there are no bills directly named AB 1633 and AB 1287 in the context of ADUs, AB 1033 builds upon previous legislation aimed at increasing housing density in California. For example, it complements SB 9, which allows for lot splits source. Together, these bills work towards increasing housing options and affordability in the state.

Does AB 1033 affect the ability to sell ADUs separately?

Yes, AB 1033 specifically allows homeowners to sell ADUs separately from the main residence on their property source. This change in regulations opens up new possibilities for homeowners to capitalize on their equity and for buyers to find housing options that suit their needs.

How has the 2025 ADU law evolved due to AB 1033?

AB 1033 is a recent development that contributes to the evolution of ADU regulations in California source. By allowing the separate sale of ADUs, this bill has the potential to influence future ADU-related legislation as the state moves towards increasing housing density and affordability.