Build small and live large is the calling card for the Accessory Dwelling Unit (ADU) movement in its infancy around the country. ADUs (aka backyard or granny houses) are small, freestanding living structures built in backyards or converted garages or home offices of single-family houses.

California recently took action to relax homebuilding rules in order that “…cities can boost affordable housing stock without spending public money…basically, it puts growth of the city in the hands of individual property owners so they can get the benefits,” said Dana Cuff, director of UCLA’s CityLab. “There’s a lot of free land in the city and it’s in people’s backyards.”

Vancouver, British Columbia is the ADU leader. As of 2016, Vancouver had legal ADUs on 1% of its single family homes.

Microhouse – grandmother’s modern backyard cottage in Vancouver, Canada

Portland, OR and Seattle, WA, the two leaders in ADU development in the US, see the ADU movement as a solution to their respective housing affordability problems. According to the Case Schiller Home Price Index, both of these cities had the greatest increases in home prices from 2016-2017. Portland experienced a 9.7% home price increase and Seattle experienced a staggering 12.2% increase.

If Portland or Seattle had as many ADUs as Vancouver, each city could have added some 40,000-50,000 new units to its housing stock. Talk about having a dramatic effect on housing supply and housing cost.

As we’ve written on this site before, the leading cities in the ADU movement thus far include Austin, San Francisco, Los Angeles, Seattle and Portland obviously, Nashville, Minneapolis and Washington, DC. DC, having made zoning changes in its code in 2016, is so happy with ADUs that it is hosting a conference called “Reinventing the Home” today, on 10/23/17, to stimulate its local ADU market.

Portland is hosting the first national Build Small Live Large Summit on November 3-5, 2017. National leaders in ADU policymaking, design, financing and development models will come together to share new ADU market research, innovative financing and development models. Presentations will also include topics such ADU benefits and opportunities, solutions for specific demographics such as age-friendly housing for seniors, and experimental affordable housing programs.

Opportunities for ADU focused small business and consulting firms are clearly available. Alexus Rivas, CEO of Cover, a business specializing in making prefabricated ADU structures, says, “There couldn’t be a better time to get into this market place.”

And Ira Belgrade, the owner of California’s first house with a legalized ADU, just opened a consulting business to assist others get backyard homes approved by local and regional agencies. “I know what it (ADU) did for me and I know how it helped me keep my home…” after his wife died and he was the sole means of support for himself and his 2 ½ year old child. “The process still takes time and know-how but, the law in CA is finally on our side…and it means Yes In My Back Yard Los Angeles (YIMBYLA).”

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