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Los Angeles ADU Construction Booms as Homeowners Seek Extra Income

Los Angeles is experiencing a boom in the construction of accessory dwelling units (ADUs), as homeowners look to earn extra income and make the most of their property. ADUs are small, independent living spaces built on a property that can be used for a variety of purposes, such as extra living space for family or guests, or as a rental unit. With the number of ADU permits issued across California increasing from almost 9,000 in 2018 to 12,392 in 2020, the trend is clear – Los Angeles homeowners are embracing ADUs as a way to earn extra income and make the most of their property.

The majority of California’s new ADUs contain just one bedroom (61%), with studio units being the second most popular unit type (18%). Units with two or more bedrooms only account for 21% of the ADUs in the state. This is largely because homeowners are looking to create affordable, low-cost living spaces that can be easily rented out. The majority of new ADUs in California are detached units (53%), built on parcels zoned for single-family residential. However, a growing number of ADUs are being built on lots with duplexes, triplexes, or fourplexes, suggesting that the move to build “missing middle” housing has already begun.

ADU production is generally occurring in diverse, transit-accessible neighborhoods where a greater share of homeowners have recently purchased their homes and still have a mortgage. Homeowners with an ADU are much more affluent and less likely to identify as Hispanic or Latine than the typical Californian homeowner. Although lower income and lower resource communities in Los Angeles County are constructing a large share of ADUs, a majority of ADU production takes place in areas with high home values and incomes, such as the San Francisco Bay Area.

So, why are Los Angeles homeowners turning to ADUs to earn extra income?

There are several reasons, including the high cost of living in Los Angeles and the need for additional living space. For many homeowners, an ADU can provide a source of extra income, as well as a place for family or guests to stay. Additionally, with the growing trend towards sustainable living and downsizing, ADUs are becoming increasingly popular as a way to create a more efficient, sustainable living environment.

If you’re considering building an ADU in Los Angeles, there are several factors to consider. The first step is to research the regulations and requirements for building an ADU in your area. The Los Angeles Department of City Planning has a wealth of information on the requirements for building an ADU, including minimum square footage, parking, accessibility, and building code compliance.

Next, you’ll need to find a qualified contractor who can help you build your ADU. With the growing popularity of ADUs, there are many contractors and real estate agents who specialize in ADU construction and can help you navigate the process. It’s also important to secure the necessary permits and make sure your ADU meets the required building and safety codes.

The cost of building an ADU in Los Angeles can range from $150,000 to $300,000 or more, depending on the size, materials, and location. However, the investment can be well worth it, as ADUs can provide a significant return on investment. Renting out your ADU can provide a source of extra income, and having an ADU can also increase the value of your property.

In conclusion, Los Angeles ADU construction is booming as homeowners look for ways to earn extra income and make the most of their property.

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