Bay Area’s housing crisis: Can accessory dwelling units help?

Lilypad Homes nonprofit founder Rachel Ginis inside the junior accessory unit in her Kenwood house. (Robbi Pengelly / Sonoma Index-Tribune)

JEFF QUACKENBUSH,

NORTH BAY BUSINESS JOURNAL

One solution to the housing crisis gripping the North Bay and the rest of the San Francisco region is to add homes to the ones that already exist, according to Marin County-based advocate for accessory dwelling units.

Also called in-law apartments and granny flats, these are additional housing on existing lots zoned for single-family housing. More than just a rented room, they are spaces set up for living independently from the main home. Depending on local rules, they can have their own bathrooms and kitchens, and may be inside, attached or detached from the house.

“I refer to this as flexible housing, because our needs for our homes are changing,” said Rachel Ginis, founder and CEO of Lilypad Homes.“And we need to create flexibility in them.”

The majority of U.S. housing are single-family dwellings, 60 percent of it built after World War II with a particular focus on the “nuclear family” of a father, mother and one child, said the anthropologist turned general contractor at the North Bay Business Journal’s Construction Industry Conference.

Trouble is, the nuclear family has lost critical mass, while houses have gotten bigger, Ginis said. Such households with child younger than 18 make up only 18 percent of the California population and 33 percent nationwide. But house size has increased by 30 percent over the last 50 years.

“We are in the midst of a massive housing crisis, but at the same time we are amazingly overhoused,” Ginis said. “People who need housing are everybody who is left over.”

Those include single-parent families, couples without kids, retirees, empty-nesters millennial professionals.

Portland, Ore., is considered the hub of accessory dwellings in the U.S., but Vancouver, British Columbia, is a leader in North America for this style of living, Ginis noted. About 35 percent of homes in that Canadian metropolis have legal accessory units.

Three common types of accessory dwelling units are cottages, conversions and carveouts. The development costs of a cottage, which is detached, in the North Bay can be $200,000–$400,000, Ginis said. Conversions of an unconditioned space such as a garage or basement into a dwelling can be $100,000–$200,000. Separating a room or area of a home into a unit, with its own private entrance, can cost $10,000–$100,000. A subset of carveouts is the junior accessory dwelling unit, which can also have a door into the main home and cost $10,000–$50,000.

“Where in the North Bay, and the Bay Area in general, can you build a single-family home, now under state law of up to 1,200 square feet — but every jurisdiction is different — for under a half-million dollars?” Ginis asked. “You take out the land costs, and you create an unbelievable opportunity for development.”

Adding accessory dwellings can boost the value of the property by up to 60 percent over homes without them, according to a Nov. 6, 2014, Wall Street Journal story that quoted a survey by real estate information and listings firm Zillow.

Gov. Jerry Brown recently signed three laws that help make ADUs a reality.

Marin Builders Association and Lilypad Homes backed Assembly Bill 2406, with allows for junior accessory dwelling units, if local governments adopt such a measure. These junior units must be conversion of an existing bedroom, add a wet-bar kitchen, have interior and exterior access, be limited to 500 square feet, have a private or shared bathroom and are deed-restricted to be owner-occupied.

AB 2299 and Senate Bill 1069 create a mandate that ADUs don’t have to have additional parking, setbacks for existing accessory units, discretionary local approvals, fire sprinklers and utility-connection fees.

“I’m proposing the most in-your-back-yard solution for housing you can possibly come up with,” Ginis said.

Jeff Quackenbush (jquackenbush@busjrnl.com, 707-521-4256) covers construction, commercial real estate and wine.