Berkeley Embraces Condo Conversions for ADUs
On Tuesday, the Berkeley City Council directed city staff to draft an ordinance authorizing ADU condo sales, in line with Assembly Bill 1033, a law that took effect at the beginning of this year. The move aims to make homeownership more accessible in one of the Bay Area's most expensive markets, where the typical home is valued at nearly $1.5 million.
Driving the news:
Berkeley appears to be the first city in California to opt into AB1033
San Jose is also considering implementing the law and will present recommendations in June.
The impact
Berkeley Council Member Rashi Kesarwani envisions teachers and healthcare workers being able to buy 500-square-foot homes in the city and parents transferring ADU-turned-condos to their adult children to build equity.
However, it's unclear how many residents will take advantage of AB1033, as building an ADU can be expensive for lower- and middle-income homeowners.
Homeowners who are part of an existing homeowners association also need permission from the association before converting the ADU into a condo.
By the numbers
According to data from the California Department of Housing and Community Development, about 410 ADUs were built in Berkeley from 2019 to 2023, including 90 last year. San Jose has built about 1,310 ADUs since 2019, including 330 in 2023.
The big picture
According to the state housing department, ADU construction has exploded in California, with nearly 1 in 5 homes built being an ADU.
While ADUs add to the for-sale housing stock, they aren't a "silver bullet" against the housing crisis
The rise of ADUs is starting to change the perception that having more neighbors is bad.
Berkeley was not great on this as recently as four to five years ago (remember “People Are Pollution”?), and it was almost impossible to build an ADU.
What's next
Kesarwani expects the ordinance legalizing ADU sales to come to the city council within a year.