All Forum Posts by: Mark Hogan

Hi Matt, one thing to consider is that it will add significantly to your property value. That square footage is not currently reflected on the assessor records, which is what goes on a real estate listing (and subsequently is how much people evaluate the selling price). If you have enough headroom (7'6") legalizing might not be that expensive, depending on what the other existing conditions are. If you have to excavate to get the headroom it will SIGNIFICANTLY more expensive. 

Hi @Pavan Sandhu - San Francisco has been allowing people to add as many ADUs as will fit inside the existing building envelope. People are removing parking or storage (typically) and putting in additional dwellings.

I'm an architect in San Francisco and our office has worked on over 50 ADU projects - mostly in larger (multifamily) buildings, but also a few single family homes. We wrote the handbook for the SF Planning Department and are working on pre-approved ADU plans for San Mateo County right now. We're looking at expanding into Los Angeles when the new statewide ADU laws go into effect in 2020 (they legalize multifamily ADUs statewide). We've seen quite a few through construction at this point- and costs are crazy in the Bay Area.

If you're not doing in-factory inspections via California's Housing and Community Development (HCD) process people are going to have an extremely hard time installing these in California and getting local building departments to sign off. Has this been set up yet? 

In the type of areas you are mentioning it is going to be tough. I might look a little further out (like Pleasant Hill) if you really want to stay in that price range. People use Craigslist a lot more to rent apartments here than Zillow, I would look there if you're focused on paying $2k/mo. You can also occasionally find non traditional situations like you describe on there but they are sometimes categorized elsewhere (not under the housing section).

Everything @Adam Mayberry said is true, and I'd like to add a link to this article I wrote a few years ago: 

https://www.archdaily.com/773491/opinion-whats-wro...

Containers are fine for certain types of commercial projects but don't make any sense for housing unless you really want that aesthetic. They are not going to save you money. 

In the Bay Area a lot of people rent out spaces like that as a house share/ roommate situation. An ADU would need a separate address and would legally be recognized as a separate unit by the assessor. The person renting that space from you wouldn't have a standard apartment lease, you'd want to create a sublet agreement that explains how utilities are split etc. The space may not be legal if all the work (kitchen etc) we're not done with permits.

I don't know the exact law in Colorado so you'd want to talk to someone local since there are definitely gray areas here.

Hi, 

I'm an architect who has worked on a lot of these in San Francisco. Your assessment will go up, but not the value of the entire property- I think your original Prop 13 basis will stay the same and they will add the value of the new unit on to it. At least this is the way SF is doing it, and I would expect Oakland is doing something similar. 

If you find out differently let me know. 

Permit costs of $50k for an 8 unit apartment building in Oakland sound very low to me. Is that including any potential impact fees, utility fees etc? I'm not saying you are wrong, but I would expect it to be higher than that. The other person who mentioned soft costs is correct too- you should be holding at least 5% of construction cost for that. How are paying for construction? There should be financing costs in there too. I do a lot of work in San Francisco, where hard costs are very similar to Oakland, and I think $300/SF is pretty optimistic right now.  

@Amit M. that is good advice, but if you are in San Francisco (specifically) there is what Planning calls a "rooms down" analysis that is done. They often will not let you have a wet bar and a full bathroom downstairs because they think you're trying to create an illegal rental unit. It's somewhat subjective because it depends on the type of connection to the main living space upstairs. It's an easier strategy in El Cerrito.