New ADU Laws in California for 2024 – Here’s What You Need To Know

The landmark introduction of AB 1033, AB 976, and AB 434 in California has revolutionized the landscape of accessory dwelling units (ADUs), introducing a new era of housing flexibility and ownership opportunities.

These groundbreaking laws, implemented in late 2023 and early 2024, have significantly altered the rules surrounding ADUs, making them a hot topic for homeowners, real estate enthusiasts, and policymakers alike.

This article delves into the intricacies of these new ADU laws, exploring their implications, processes, and the varied reactions they have garnered across different municipalities.

Here at GreatBuildz, a free service that connects homeowners in Los Angeles, Ventura, and Orange Counties with reliable general contractors, we help homeowners navigate their ADU projects every day.

Whether you are a property owner looking to navigate the complexities of selling an ADU, a prospective buyer curious about the evolving ADU market, or simply interested in the latest developments in California’s housing regulations, this comprehensive guide offers essential insights into the new ADU laws: AB 1033, AB 976, and AB 434. Stay informed and ahead of the curve in understanding how these laws impact the California housing landscape.

New ADU Law – AB 1033

new ADU laws for 2024

The introduction of AB 1033 in October 2023 brought forth a great deal of enthusiasm because it marked a major shift in the accessibility of accessory dwelling units (ADUs). This law, in contrast to previous limitations, permits the sale of ADUs apart from the primary residences on a property. However, there are significant practical restrictions on this law’s potential influence.

Municipalities and localities are empowered by AB 1033 to pass ordinances allowing for the individual selling of ADUs. Crucially, there is flexibility throughout jurisdictions because the law does not require this kind of activity. While some cities would be excited about this new possibility, others might decide not to include this provision in their municipal ordinances.

Selling an ADU apart from the primary residence is a complicated process that necessitates turning the property into a recognized “condominium.” This entails hiring attorneys to establish declarations and bylaws for the condominium and employing surveyors to draw a map of the condo plat that shows the boundaries of ownership. The next steps are to record these documents at the County Recorder’s office and submit them for approval to the California Department of Real Estate.

After this procedure is finished, the ADU may be offered for sale as a stand-alone “condo” on the land. On the other hand, by creating a Homeowners Association (HOA) between the primary residence and the ADU, common property will be jointly managed. This conversion also lowers the value of the remaining house, turning it into a condominium instead of a single-family home.

It’s important to remember that property owners who have loans already in place have to ask their lenders for permission before selling any piece of the loan-secured property (the ADU, for example). The dispersion of loan security may present issues for lenders, thus this process might not go well.

See [AB 1033] for the official text for more information on the new ADU laws.

New ADU Law – AB 976

ADU construction planset

AB 976, another significant piece of law, deals with the “owner occupancy” limitations on ADUs that are allowed between January 1, 2020, and January 1, 2025. Before this statute, localities had the authority to impose such limitations, which would have restricted property owners’ ability to rent their ADUs. The deadline is eliminated by AB 976, making it impossible for cities to impose owner-occupancy restrictions on ADUs. Local governments do, however, still have the power to limit the length of rentals to more than thirty days.

Visit the official document, [AB 976] to learn more about the details of the new ADU laws.

New ADU Law – AB 434

New ADU laws for 2024

Finally, by January 1, 2025, all Californian cities and municipalities must have a pre-approved ADU plan scheme in place thanks to AB 434. In order for plans to be “pre-approved” for use by applicants or other property owners in the future, cities must accept submissions for them. The law promotes the publication of these plans on the city website so that a larger public can view them.

Although it is assumed that architects play a major role in getting pre-approval for the plans they have designed, users most likely have to pay fees to use these designs. Even though these plans have been pre-approved, they can still require modifications to fit the particular features of each property. Additionally, the law allows towns to collect the same costs for the “plan check” procedure for plans that have been pre-approved as it would for any other set of plans.

The goal of AB 434 is to expedite California’s ADU planning and construction procedures. Pre-approved designs that save time and money when creating bespoke plans can be found on the city website, albeit they are not always suitable because of property-specific factors.

Consult the official text of AB 434 for a thorough understanding of the new ADU laws: [AB 434]

Related: Learn more about building an ADU

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