New State Laws Ease 'Granny Flat' Rules

New State Laws Ease 'Granny Flat' Rules

  • Sue and Gina De Legge
  • 03/18/20
New laws went into place on January 1, 2020 in California that are easing the rules for constructing accessory dwelling units (ADUs), sometimes known as ‘granny flats,’ on residential property. The average home price in California is about 250% above the national average, while average monthly housing rents are about 50% above national levels. The new laws are designed to make it easier for Californians to construct a second dwelling on their property in an effort to help the State's housing shortage and affordability.
Interior of ADU at 1910 Lake Drive, Cardiff-by-the-Sea, California

In this post we explore some commonly asked questions regarding the new rules and provide resources if you are considering building an ADU.

1. What is an ADU?

An ADU is an additional small square footage dwelling built by

homeowners on their residential zoned property

2. Why build an ADU?

  • Additional rental income
  • By adding more square footage you increase the value of your home 
  • Provides affordable housing options for family members, friends, students, the disabled, and others. 
This Cardiff-by-the-Sea property utilized the existing structure with an 800 sq ft ADU above the garage. 1910 Lake Drive, Cardiff, California.

3. What are the ADU Building options?

  • Attached or detached from the primary residence
  • Garage conversion
  • Over the garage
  • Basment or attic conversion

Image credit: San Diego County Planning and Development Services

4. Do I need a building permit for an ADU?

Yes! You will be required to obtain a Building Permit to make sure that the ADU meets all the zoning, building, health and safety codes. We recommend working with a licensed contractor who has experience with ADUs. If you would like recommendations, please contact us.

IMPORTANT: If the ADU structure was not permitted and/or if there are unpaid construction liens, that information would be discovered during a title search and could complicate, if not derail, a potential sale of the property by the primary homeowner.

5. What are the size restrictions for building an ADU in California?

  • An ADU must be secondary in size to the primary residence.
  • A structure attached to the primary home may be up to 50% of the size of the single-family home with a maximum of 1,200 square feet.
  • ADU detached from the residence may be up to 1,200 square feet regardless of the size of the primary residence.​​​​​​​

Allowable ADU sizes examples:

6. I purchased an investment property and would like to build an ADU. Do I have to be a primary resident of the property in order to build an ADU?

No. California no longer requires owners to live in the primary residence or the ADU. The owner-occupancy requirement has been removed in California until the year 2025. ADU built between 2020-2025 are grandfathered into the no owner-occupancy requirement even if the legislation changes to require owner occupancy in the future.

An ADU in Pacific Beach utilizes a space-saving convertible sofa bed.

7. Are there any rental restrictions for an ADU?

Not surprising, as the new ADU laws are designed to address the California housing crisis, short-term rentals such as Airbnb and VRBO are restricted for ADUs in San Diego County. ADUs can be rented for 30-days or longer.

An ADU at a home in Pacific Beach, San Diego

8. What are the steps to building an ADU on my property?

These are the general steps to build an ADU. Often times, professional builders and contractors work with you and guide you through these steps. We highly recommend working with contractors that have built ADUs and are familiar with the rules. 

1. Determine how you are going to finance. There are a number of options for financing an ADU such as cash, home-equity, refinancing, and renovation lending. Contact your lender and apply for loan pre-approval. 

2. Create your preliminary design.

3. Get building estimates and bids.

4. Select the contractor. 

5.Finalize your design with an architect or check out San Diego County free Standard ADU Building Plans

6. Submit building permit application - ADU builders and contractors can help you obtain permits.

7. Receive permit and start construction.

8. Construction is complete and ready for construction inspections.

9.Obtain the Certificate of Occupancy

10. Create ads for renters and start collecting your rental income!

9. How much does it cost to build an ADU?

The data varies on the cost to build an ADU and depends on a number of factors such as the type of ADU you build, where you are located, contractors and builder costs, and if you are building on an existing structure.

Generally, garage and basement conversions are the most economical to build. I've seen data on conversions that range from $10,000 to $100,000.

Detached "Granny Flats" can range from $100,000 to $300,000+.

Resource: has a free Break-Even Calculator that will help you determine the amount of money you'll need to cover your expenses, project your future revenue, appreciation rates, and run a cost/benefit analysis. 

An ADU built above the garage boast stunning views. 1910 Lake Dr, Cardiff-by-the-Sea, California,


Free County Approved Building Plans!

San Diego County Planning and Development Services has a number of resources online including County Standard ADU Building Plans, an ADU Checklist, Stormwater Best Management Practices Standard, Energy calculations (Calcerts), and Truss designs. 

Visit San Deigo County's Planning and Development Services website here. 

An ADU in Pacific Beach utilizes a space-saving convertible sofa bed.

Permit Costs Waived

The County also waived ADU permit and development impact fee for a period of 5 years, which began on January 9, 2019. This saves homeowners an average of $14,000 on permit costs! 

No More Additional Parking 

With the new laws property owners building an ADU no longer have to account for additional parking if your home is within half a mile of public transportation.

We hope you find this blog a helpful resource, please contact us if you have any additional questions or would like to be added to our mailing list.

There are multiple properties on the market in San Diego County that are ideal for an ADU. If you are interested in investing in a property or considering selling, please contact us.

S ue De Legge & Gina De Legge-Habchi

(760) 207-7749 & (760) 579-8108

DRE # 01304408 & DRE #01746528

[email protected]

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Sue & Gina De Legge provides their clients with a higher level of personalized attention that you won’t find anywhere else. They focus on going above and beyond their client's expectations so that they earn a long-term relationship built on trust wherein they become referable.

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