There is every reason to believe that ADUs can do great in a recession. Rationale players may realize that ADUs are one of the safest places to invest their money in a recession.
The latest sudden and dramatic economic crisis may threaten far greater economic consequences than the housing crash of 2008. If so, these economic impacts are catastrophic and life-changing, which will affect us all.
The Covid-19 has already impacted supply chain, restaurants, stores, venues, gyms, and theaters that may never opening back up and for those who will open back it is unknown how they will do as their business plan just got thrown out the window, whole sectors of the retail economy have just gone extinct overnight. Potentially millions of working people will need to transition to new jobs in non-retail sectors. These economic impacts will be deeply personal and emotionally wrenching for all of us.
This Coronavirus Recession will continue to impact our economy for a long time. Even with a record-breaking stimulus package, some degree of economic collapse is where we are likely headed. When we talk about solutions, we must consider shifting whole sectors of the economy.
ADU development is an incredibly self-serving thing to do with your money. With an ADU, you are investing directly into your future self. Once rented, you add substantial extra monthly income. That income will in most cases be greater than the costs of the payment on a construction loan for your ADU. Furthermore, you are adding significant long-term resale value to your property.
The next couple of years is the timeframe to act on the idea of developing an ADU. With the Coronavirus Recession, homeowners should start to consider it a civic duty to putting an ADU (and JADU) on their property.
ADUs offer something new, critical and timely; a chance for us to help our communities save themselves from the approaching economic outfall of the Coronavirus.
ADU development is not something that the state would or should mandate. But if you are a California homeowner, by developing an ADU in Los Angeles you are not only investing in yourself, but also helping the affordable housing crisis and stimulating the economy.
This new time we have entered will generate a bigger demand on ADUs and we are already seeing it, main reasons are:
1. Los Angeles housing costs too much for most people.
2. Demand for housing in Los Angeles is bigger than supply.
3. Small units are in bigger shortage.
4. Most developed urban land is dominated by single family residential zoning.
5. Most People prefer to live in residential areas.
Invest in an ADU, now. If you are a homeowner in Los Angeles area, and have been sitting on the fence about developing an ADU, the next couple of years is the time to do it for your financial security.