Growth of the ADU

AAccessory dwelling units, or ADUs, are the diminutive housing market juggernaut tiny homes were intended to be, if not quite the media darling. While design shows and travel and lifestyle shows featured myriad variety of tiny homes, ADUs have found the financial and legal pathways to gain the attention of city and village halls nationwide. In just a few weeks in May and June, headlines in diverse markets hailed ADUs as the best way to solve the housing crisis in densely populated and expensive areas. On May 25, Forbes contributor Jeffrey Steele’s headline declared “Affordable Housing Crisis

Demands ADUs, DADUs”.

“If there are solutions to the crisis, one may be found in the concept of the Detached Accessory Dwelling Unit, or DADU. Known in some places as granny flats or coach houses, these compact dwellings are legally permitted on parcels of existing homes… They provide additional housing options to those who otherwise likely wouldn’t have hope of finding one. And for that reason, many municipalities are making way for them,” the article stated.

Neal Collins at the San Jose Spotlight said revised regulations for ADUs in California since they were approved in 2016 have spurred growth. The state eliminated the owner-occupancy rule, so now owners can rent both the primary residence and the ADU. Additional revisions addressed cumbersome set-back and lot size requirements.

In its initial year, California issued fewer than 5,000 ADU permits, but between 2018 and 2020 more than 33,800 such permits were issued.

In early June, Madison.com let its readers in Madison, Wisc., know that there are new opportunities for homeowners who want an adjacent residence. The city had allowed ADUs for nearly 10 years but recently dropped the application and approval process that slowed development. Now ADUs are allowed in all areas where single-family homes are allowed. It also allowed for attached units, so garage lofts and other underused sections of the existing home can be used. It also increased the allowable floor space to 900 square feet.

Other such headlines during the same time frame ring from Salt Lake City, Utah, Austin, Texas, St. Petersburg, Fla., and the islands of Hawaii. Each locale has big business, high land cost, and robust service and hospitality sectors that require a labor force to be able to live where they work.

Manufactured housing professionals have said ADUs represent the welcome entry of factory-built affordable housing into urban areas. While not all ADUs are built off site, many are, including by some of the largest manufactured home builders in the country.

Skyline Champion, for instance, brought a new ADU to the National Mall in early June as part of MHI’s Homes on the Hill and HUD’s Innovative Housing Showcase during National Homeownership Month.

ADUs can be many things, from a granny flat to student housing. Moreover, small, affordable, energy-efficient homes located in city centers have been shown to stabilize local rental markets in availability and price.

Each ADU discussion and meeting with local officials is an opportunity to demonstrate to the right people what factory-built housing can do for a community, its retirees, students, and service industries. MHV

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