ADUs are Gaining Popularity on the West Coast
Companies and local governments up and down the Western U.S. are showing a spike in demand for accessory dwelling units so far this year.
The popularity of accessory dwelling units (ADUs) is on the rise across the West Coast. In the Seattle area, there was a 250% ADU construction increase in 2022 compared to 2019. And in California, demand for ADUs is quickly outpacing supply, according to local media outlets and reports from local governments and building organizations.
In Seattle, a report designed for City Council outlines that during 2022, permitted ADU construction increased to 988 total units — a sharp rise from the 280 ADU construction permits issued in 2019. The report also provides context for use by the state’s legislature as bills are considered to help accelerate ADU construction across the Evergreen State, according to the Seattle Times. In addition, ADU construction in Seattle is outpacing single-family homes, the first time this has happened, according to the city report.
Further down the I-5 corridor in California, a San Francisco-based ADU building company, Cottage, released findings that show ADU demand in the Golden State is the hottest in the nation, as ADU permit applications in the state have risen precipitously — climbing from under 10,000 in 2017 to an estimated 30,000 in 2022, according to preliminary projections. However, the demand for ADUs is higher than the number of finished units, the report states.
“Recent data shows that for every ADU completed in 2022, roughly three permits were submitted in 2021,” the report reads. “Or, another way to look at it: For every three people motivated to invest in creating an ADU across California, only one will have an ADU in the next year.”
Most of the ADU activity is concentrated in the Los Angeles area — West L.A. in particular — and the San Fernando Valley, according to Alex Czarnecki, Cottage’s founder and CEO.
“60% of ADU permits from California were in L.A. in 2022,” Czarnecki told the San Fernando Valley Business Journal in late February.
While the pandemic was likely one factor that drove the uptick in interest in ADUs, Czarnecki said that California’s regulatory climate has also made the process of constructing the units a more enticing prospect.
“Across California, the state has continued to pass, year by year, additional legislation that makes it easier for homeowners to build ADUs,” he said. “The ADU space has been doubling year over year since 2018 in a lot of these markets.”
Last month, during the Affordable Housing Mini-Con hosted by HousingWire, Laurie Goodman of the Urban Institute said that ADU construction could serve as a potential solution for senior housing issues that are becoming more prevalent across the nation. Other industries — including some reverse mortgage businesses — are also examining ways to incorporate ADU construction into their models serving seniors.