Reverse

Bay Area lawmakers OK new ADU guidelines to spur construction, citing needs of seniors

The move is seen as an acknowledgement of ADUs as a tool to allow more seniors to avoid specialized living facilities

The Marin County Board of Supervisors in Northern California on Tuesday approved reduced fees to build accessory dwelling units (ADUs) in unincorporated parts of the county, according to an announcement by county officials.

Marin County is situated across the Golden Gate Bridge, north of San Francisco. It is a notoriously expensive housing market and maintains an estimated population of more than 260,000 people, according to data from the 2020 U.S. Census.

Like many localities across the country, Marin County leaders describe a housing crisis in their area that they hope to alleviate through the construction of more ADUs. They especially aim to serve those undergoing life transitions, like seniors.

“Homeowners thinking about second units are often going through a life transition — seniors transitioning to a fixed income, first time homeowners looking for a way to afford a home, adults becoming empty nesters, looking for a solution to an overcrowded household, or seeking to create affordable housing for friends and family,” the county said in an announcement of its new policy.

“An ADU can generate new rental income, help someone age in place, help a financially strapped college student or recently discharged military veteran, or just provide a community benefit of a new home for anyone in need.”

The new resolution, adopted by the Marin County Board of Supervisors, allows administrative staff to “waive and reduce several types of fees for certain ADUs through the end of 2024.” The hope is that results will save applicants “thousands of dollars for building permits and roadway impact fees, especially for units that qualify as affordable housing,” the county said.

Last year, the state of California approved an updated housing plan for the county that included a goal of producing 280 ADUs from 2023 to 2031. The county was deemed to be on the right track as permit applications for ADUs and JADUs (junior accessory dwelling units, or living spaces built from existing structures on the property) rose from 35 in 2019 to 81 in 2023. But they have declined from a peak of 154 in 2021, prompting a discussion of more incentives.

ADUs are an increasingly popular option for people seeking novel alternatives to housing, particularly on the West Coast. The reverse mortgage business has also recently become interested in the use of financing, such as a Home Equity Conversion Mortgage (HECM), to fund ADU construction, although this is not an avenue available to the expected resident of the ADU itself.

The Federal Housing Administration (FHA) has also taken notice of the potential between ADUs and reverse mortgages, adding ADU rental income to eligibility criteria for a reverse mortgage late last year in a measure supported by the National Reverse Mortgage Lenders Association (NRMLA). 

ADU construction could also serve as a potential solution for senior housing issues that are becoming more prevalent across the nation, according to experts from the Urban Institute.

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