2025 Welcomes a Gaggle of New Real Estate Laws Related to ADUs

Published On: January 15, 2025807 words4 min read

If you’ve considered adding an Accessory Dwelling Unit (ADU) to your property, 2025 might be your year. With a flurry of new laws to expand housing opportunities and cut through the red tape, California is doubling down on its ADU-friendly stance. But as with any government initiative, the new rules come with quirks, benefits, and a fair share of fine print.

Here’s a breakdown of what these new laws mean for homeowners, developers, and anyone trying to navigate the ever-evolving world of real estate in the Golden State.

Legalizing the “Unpermitted” (AB 2533)

Have an unpermitted ADU on your property? AB 2533 is here to give you a break. This law allows these units to be legalized without requiring updates to current building codes or payment of hefty impact fees. Of course, there are safety requirements to meet, but this is a big win for homeowners who’ve been quietly housing renters in unofficial units for years.

Doubling Down on Multi-Family Units (SB 1211)

Multi-family property owners, rejoice. SB 1211 grants you the right to build one additional ADU for each existing unit—up to a maximum of eight. Yes, you read that correctly. For properties looking to maximize rental income, this law is a golden opportunity to increase density without a zoning battle

The Coastal Conundrum (SB 1077)

For those lucky enough to own property in California Coastal Commission areas, SB 1077 creates a path to more straightforward guidelines for ADU development. The Coastal Commission hasn’t always been known for its flexibility. Still, this bill signals a move toward more defined rules, making it easier to add housing in some of the state’s most desirable (and regulated) locales.

Junior ADUs Get a Pass (AB 3057)

Smaller, more affordable, and increasingly popular, Junior ADUs (JADUs) are now exempt from environmental challenges, thanks to AB 3057. This law is a welcome change for homeowners who want to create additional living space without the bureaucratic headache.

Transit-Oriented Housing Just Got Taller (AB 2553)

If your property is within ½ mile of a “major” transit stop (defined as bus service every 20 minutes), you’re now allowed to build ADUs up to 18 feet tall—or two stories. Not only that but impact fees have also been reduced for these transit-adjacent projects. This law is worth paying attention to for those betting on the future of public transportation.

No More Upfront Impact Fees (SB 937)

Impact fees—those dreaded costs that can derail a project before it even gets off the ground—can now only be charged when a project is complete. Under SB 937, cities and counties must wait until they issue the certificate of occupancy or final inspection to collect these fees. This change ensures property owners aren’t fronting massive costs months or years before approval.

Breathing Room for Expiring Permits (AB 2729)

If you received a permit before January 1, 2024, and it was set to expire, AB 2729 extends its life by 18 months. This is a much-needed reprieve for projects delayed by supply chain issues, labor shortages, or the general chaos of the past few years.

When Cities Drop the Ball (AB 1893 & SB 1037)

Here’s where things get interesting. AB 1893 introduces the “builder’s remedy,” which lets developers move forward without permits if a city is out of compliance with state housing requirements. SB 1037 adds teeth by imposing fines of $10,000 to $50,000 per unit per month when cities drag their feet on ADU approvals or other housing mandates.

In short, if a city’s bureaucracy is slowing down housing, it could pay a hefty price.

Strengthening SB 9 Protections (SB 450)

Remember SB 9, the law that made splitting lots and adding housing easier? SB 450 builds on that, introducing a 60-day shot clock for lot split approvals. Cities and counties must provide a clear list of remedies or corrective actions if denied. This law also prevents overly restrictive rezoning, ensuring new lots can accommodate homes like their neighbors.

A Nod to Tenant Protections (AB 2347)

Finally, AB 2347 gives tenants more time to respond to eviction notices, doubling the response window from five business days to ten. While this isn’t directly tied to ADUs, it reflects a broader effort to balance the housing market by supporting renters.

Final Thoughts

As always, the government giveth, and the government taketh away—but for 2025, it seems like California is leaning heavily toward giving. These laws represent a significant push to make housing more accessible, affordable, and feasible for property owners and developers alike.

From legalizing unpermitted units to reducing fees and adding accountability for cities, this year’s legislative updates could make a real difference in easing the state’s housing crisis.

If you’re thinking about adding an ADU or capitalizing on these new laws, now’s the time to act. With fewer barriers and more incentives, 2025 might just be the year of the ADU Renaissance.

 

Contact Summit Mortgage and Investment Company
Eric Rolph | (805) 358-3926

Summit Property Management

Looking for professional, reliable property management? Contact Summit Property Management today to ensure your property is in the best hands!

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