Upcoming ADU changes

There is a new bill that is in the middle of approval that would increase the number of ADU’s on multi family properties. If this passes, this is welcome news for a lot of multi family owners and potential multi family buyers.

It has been many years since it made any sense for developers to build multi family or large scale apartment buildings beyond companies like the Irvine Company. I think it’s fair to say that the Irvine Company has an awful lot of power in Irvine and can make building multi family make financial sense. Although this bill doesn’t quite grease the wheels to build large scale apartment buildings enough to make them financially profitable, it would increase density for individual properties. If enough individual owners increase the density of their properties, this could function like adding an apartment building in a neighborhood.

Increasing density ought to increase income for multi family owners and supply more inventory for renters. More supply would mean rents won’t increase quite as quickly and renters should be able to both manage that cost and negate a lot of housing inflation. This ought to increase the affordability for a lot of renters.

In addition to helping renters manage their housing costs, this ought to increase rental income for many owners. Increasing rental income naturally increases the value of owners’ properties. More often than not, multi family properties sell based on their rental income.

For more information regarding SB1211 click this link