General Landlording & Rental Properties
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback
Updated over 3 years ago,
Two ADUs or split up the parcel?
Question for those of you with more experience than I,
With all the new laws Governor Newsom passed in California recently to increase affordable housing, I am torn on what to do with our rental property! There are benefits to both options.
My fiancé and I own a duplex in Northern California with adequate lot space to develop another two units by the side of our existing duplex. Lots of parking available but the property is exempt under the new law to add parking because we live next to a bus stop! So funny.
Anyway, do I build two ADU's on the property and essentially make it a 4 plex property, get the cal grant of 25k towards development, save money on permitting fees since the units will be exempt from impact fees (8k each if they're under 750 square feet) have expedited permitting under the new law; and also save money on metering and utility set ups since they can tie into our main BUT be prohibited or ever separating our parcel and selling them on their own, (and we'd get about 1600 a month in rent off of each of them so we'd cashflow quite a bit)
OR split the parcel to build two separate units that can be sold immediately after they’re constructed, but then have lots of extraneous costs like impact fees, utility fees, and not have the expedited approval BUT make a lot more money on the sale if I were to sell it, but have much less cash flow than if I build ADUs instead.
Totally torn :(