How to Build an ADU in Los Angeles in 2022
Compared to last year Los Angeles home prices have risen by 13.5% (from May 2021 to May 2022). With that, homelessness levels have been on the rise in the area, sparking the need for government to take action. One of the solutions to the rising housing problem, in the city of LA is encouraging the development of additional dwelling units (ADUs).
Everyone from policymakers to real estate developers is invested in finding a way to increase the available and affordable housing stock to keep people off the streets and closer to their jobs. ADUs satisfy this need along with other housing, and non-livable space needs many individuals have. Read on to find out how to build an ADU in Los Angeles and how ADUs differ from other housing options.
The Need for ADUs
Before we dive into how to build an ADU in LA, let’s first take a look at why you should.
The rising trend of the LA housing market prices can be seen year after year with the median sale price being just above $600,000 in 2018, to $1,050,000 in May of 2022. From 2019 to 2020, homelessness levels in the city of LA rose by 14.2%. These numbers have likely risen since due to the pandemic.
New California State Laws and the LA Accessory Dwelling Unit Standard Plan Program have made it easier than ever to build an ADU in Los Angeles. To learn more about why ADU development in Los Angeles is a good idea, click here.
What Is An ADU?
ADUs provide a solution to the growing housing crisis in LA, but what exactly are they?
As a general rule, ADUs are additional dwelling units that exist on a single-family plot with a primary home. There are multiple different types that can benefit the homeowner and the surrounding community in a variety of ways.
These units are known by a variety of names including:
- Accessory apartment
- Backyard bungalow
- Carriage house
- Coach house
- Garage house
- Granny flat
- Guest house
- In-law suite
- Ohana (popular in the Hawaiian Islands)
- Secondary Dwelling Unit
However, it is important to note that ADUs are not the same thing as tiny homes or SB9 units.
Tiny Homes and SB9s
ADUs are similar to tiny homes in many aspects but are considered two different things by law. A tiny home is generally mobile and illegal to have in your yard in most places. They can also be a primary residence, which an ADU cannot be the primary residence on a plot of land.
The same goes for SB9 units. Although they are similar to ADUs in the fact that they can be a secondary unit on a single-family plot, they differ in regulations and size.
Therefore, we will only be talking about how to build an ADU, not a tiny home or SB9.
1. Starting Your ADU
Before you begin any construction project, including building an ADU yourself, it is always important to do your research first. This free ADU Development Guidebook can help you better understand the process of building an ADU and the types available for you to construct.
There are four main types of ADUs.
- Attached: Shares a wall with your primary home
- Detached: A stand-alone unit
- Garage conversion: Turn your pre-existing structure into an ADU
- Internal: Exists within your primary home
Each type of ADU has advantages and disadvantages associated with them. For example, a garage conversion is usually the most affordable type but means you are giving up your garage space. A detached ADU is more costly but offers you the chance to design from the ground up.
To make your ADU development as smooth as possible, we recommend working with an ADU professional from the start. They will be able to help you understand what types of ADUs will work best for your needs and coach you through every step of development.
2. Set Your Budget
After you have completed your ADU research, it is time to work out a budget. One of the biggest ADU mistakes anyone can make is not creating a budget at the start of the project. Without one, you will likely overspend and could get halfway through and realize you don’t have enough money to complete the project.
To set the budget, you need to gather all the ADU costs. This will include things like:
- Design & Planning
- City fees
- Construction labor
- Finished materials
- Rough materials
- Special inspections fees
Be sure to set money aside for unexpected costs as well. That way, if you hit a speed bump during your development process, it won’t put the entire project on halt while you try to find money to cover it.
3. Secure ADU Financing
With a solid budget and timeframe created, it is time to figure out how you will pay for your ADU. A few options for you to consider are:
- Cash-out refinancing
- Home equity loans & HELOCs
- Peer-to-peer lending
- Renovation loan
- Savings Account
You can also consider taking advantage of the CalHFA ADU grant program that offers low-to-moderate-income homeowners access to up to $40,000 for pre-construction costs for an ADU.
4. Conduct A Feasibility Study
To determine which type of ADU you can build on your property, the zoning laws in your area, and the ADU size limits, you can conduct a feasibility study. This study will also let you know several important aspects of constructing an ADU including:
- City impact fees
- Occupancy rules
- Parking requirements
To begin the study, you will need to create a sitemap of your property with all structures clearly marked. Then you will need to meet with your local planning department to determine the construction regulations in your area.
5. Start Designing Your ADU
With a solid understanding of where your ADU can be built on your property and how big, you can now begin the design process. We highly recommend getting a 3D rendering of your floor plan to have a better idea of what the finished product will look like to prevent costly changes later on.
A few important design tips to consider include:
- Design from the outside in to prevent going over size restrictions
- Include laundry units
- Include lots of storage wherever you can
- Include lots of windows to take advantage of natural lighting
- Use wall and mounted lighting to make the most use of your space
ADUs are small. Do whatever you can do to not make them feel like a dark, cramped closet. This means taking advantage of natural lighting and including storage wisely. Nobody wants to live in a small dark box with no room for their belongings. There are plenty of opportunities to make your ADU a wonderful place to live, and it starts by taking into consideration the design tips above.
6. Planning Your ADU
With a design hashed out, it is time to start planning your ADU. This step will involve working with a number of professionals to develop different plans, surveys, and calculations including:
- Architectural drawings
- Electrical Layout.
- Energy calculations
- General notes and details associated with drawings
- Land surveys (in some cases)
- Soil engineering (in some cases)
- Stormwater management (units 500 Sqf an above)
- Structural drawings
Plans will need to be submitted to all necessary departments to be approved and ensure everything is done legally. You can check out this eCourse for training videos and sample plans to make this step easier.
7. Acquiring Your ADU Permits
Some people consider skipping this step. We are here to tell you not to. Not properly permitting your ADU can result in serious fines, halts in construction, along with other legal predicaments. It simply is not worth it.
The permitting process can be lengthy, as we mentioned in step 6. The four general steps of the permitting process include:
- Submit drawings, calculations, and required documents
- Plans are reviewed and sent back with instructions on how to gain compliance with codes and regulations
- You will need to obtain clearance from city departments (i.e., water, power, etc.)
- Plans will go through a final review and permits will be issued
Working with an ADU professional can also speed up this process because plans are more likely to comply with codes and regulations from the start if an ADU professional has created them. This is because they are more familiar with the permitting process.
8. Find A Contractor
With permits in hand, it is time to start looking for someone to build your ADU. The contractor you choose should have experience building ADUs in Los Angeles. Working with a general contractor is a risk since ADUs have such specific regulations surrounding them. You want someone who knows the ins and outs of ADUs to be the one doing the job.
The six main steps to finding an ADU contractor in LA are:
- Have a detailed plan of how you want your ADU to look (steps 5 and 6)
- Make a detailed scope of work
- Project overview
- Project deliverables
- Project scope
- Schedule summary
- Project management
- Search for a contractor (word-of-mouth, professional organization directories, etc.)
- Choose 3 to 4 contractors to look further into
- Compare contractor estimates
- Draw a contract
- Schedule of the stages of the project
- Information about warranties
- A termination clause
- A requirement that the contractor will obtain a lien release
Remember, the cheapest contractor is not never the safest choice. They often end up being more expensive due to a lack of experience or hidden fees. Make sure the contractor you choose:
- Has at least 3 years of experience building ADUs
- Has experience building in LA
- Is upfront about their fees
- Is fully licensed and insured
9. Obtain Your Materials
Your contractor will be able to help you determine which materials you will need to meet your design needs. They will also be able to give you ideas on how to save money by switching to similar, less expensive material options. Also, they will likely be able to recommend the best places to get materials from since they work in LA often.
10. Constructing Your ADU
With materials obtained, your contractor can get to work building your ADU. It is always good to maintain an open line of communication between you and the contractor to ensure everything is going to plan.
A great tip to keep in mind is that you should always talk to your contractor about design change needs or progress updates, not their crew. The crew is not as qualified as the contractor to make decisions, and by talking to them you can get the incorrect information. So, to prevent any miscommunication, always speak with your contractor directly.
11. Decorate Your ADU
Once fully constructed, it is time to begin decorating your ADU with appliances and furniture. There are several ADU appliances and furniture options to consider to make your ADU a cozy and practical living space. Always opt for appliances that save the most space and have dual purposes. The more space you can save, the less cramped your ADU will feel.
12. Using Your ADU
With a fully furnished ADU, you can begin living in your ADU or renting it out. It is important to note that in LA there are strict ADU rent control laws that can be confusing. ADUs in LA may be covered by different rent control laws depending on the age and type of ADU.
So, before you begin renting out your ADU in LA, make sure you understand all the rent stabilization laws in effect.
Other Ways to Use Your ADU
You can use your ADU in a variety of ways besides renting it out to bring in extra income or provide affordable living for people in your community.
An ADU can be used for:
- Non-living space reasons (personal gym, home office, etc.)
- Multi-generational housing
- Guest house
- Housing caretakers
- House hacking
No matter how you use your ADU, we are sure you will enjoy having it!
Get Started Today!
Are you looking to build an ADU in Los Angeles but need help from an ADU professional? Consider working with Levi Design Build! We have years of experience developing ADUs in the local area. Our team and partners of experts is always eager to provide you with the best customer experience, design, and craftsmanship to meet your design, planning, and construction needs.